So, when Thalin is questing he gets to do a damage to each Enemy that get revealed (which is awesome!). Eastern Crows only have one health so they'll wing their way to the discard pile.

Here's my question: Does their Surge keyword still take affect?

gatharion said:

According to last FAQ Thalin kills Crows before surge effect tak place to be. So Crow go to discard pile and no surge effect.

Glaurung said:

Glaurung is mostly correct. Thalin does kill the crows before their surge keyword takes effect, but they still get shuffled back into the deck due to their Forced ability.

The one I've been puzzling over, is what happens when you get to the bottom of the pile?

On a few occassions we've had the last two cards in the deck being Eastern crows, 4-player game.

option 1: reveal first encounter card - crows, killed by Thalin, shuffle back with 1 remaining card, draw 2nd encounter card - crows, repeat.

option 2: draw two cards (both crows, but not known yet) shuffle discard pile, draw another two. Reveal all 4, both crows shuffled back into new encounter pile.

any thoughts?

Option 1 is correct. It is possible, although unlikely, that you could trap the game in a loop in this way - if you have no enemies in play, then none will get shadow cards, and you'll never cycle through the deck. Sort of a cheezy way to get through the game, but c'est la vie.

(if it really bothers you, just don't quest with Thalin for 1 turn.)