Everyone says Thalin doesn't damage enemies with the Toughness keyword but I believe he does because he says they "enter" play.

I am not sure I follow you. Thalin deals 1 damage to each enemy as it is revealed by the encounter deck. Enemies with Toughness reduce each instance of damage dealt to them by X, where X is their Toughness value. Therefore an enemy with any value of Toughness is going to cancel Thalin's damage. Unless you are suggesting that their Toughness text is not yet active because the card is not yet "in play" while it is "being revealed?" I think Toughness would be active at this point.

Mmm.... surge does not apply before Thalin's damage so why should Toughness apply before the damage input?

The surge keyword specifically refers to "when" the card is revealed. Since Thalin kills the Eastern Crows before they reach the "when revealed" part of their staging, the Surge keyword doesn't actually do anything. The card never reaches the point when Surge would do anything. It's not explicitly stated when Toughness comes into effect, but we may assume it is in effect as soon as the card is "in play". The encounter card presumably must be "in play" when Thalin deals a damage to it, otherwise it wouldn't be physically possible to deal a damage to it. Hence, it's a reasonable guess that Toughness is in effect as the card is being revealed.

I don't think it's ever been explicitly answered, but I think our best guess should be that Toughness stops Thalin.

Toughness "reduces any amount of damage dealt" to the enemy. The enemy's text box is active when Thalin deals the damage, so that damage is reduced.

From Caleb:

Toughness will cancel Thalin’s damage.