Hey, I may have asked this question before, but I don't remember getting an answer.

On the second quest stage it says something like: "Reveal stage 3 and create a separate staging area for the first player using that stage."

What I don't understand is it sounds like the effect on Stage 3, which is Remove all resources from all heroes and make everyone unconscious except Bilbo, would effect ALL players, not just the first player. But that would make the quest absolutely impossible. Does it just effect the first player?

It just affects the first player. This is because the first player is the only player at that stage. Any card effects, including those printed on the quest card, will affect only the player currently at that stage of the quest. Players 2-4 aren't at stage 3, so they will not be impacted.

Okay, thanks. Just wanted to make sure.

I dont have this quest yet but curiosity hits me. From what you both say above, does this mean this quest us not possible solo unless playing two handed?

No, you can do it solo. It plays differently. In multiplayer, the player with Bilbo gets split off from the rest of the group, and all of his characters except Bilbo are rendered unconscious (can't do anything). The rest of the players go and fight spiders until Bilbo catches up with them. In solo, there is simply no group waiting for Bilbo to catch up.