This area is northwest of the Lone House area, as the crow flies. Sadly, you’re no crow, and the only navigable routes there require you to go out of your way a bit. That being the case, since there’s no profit in retreading ground you’ve already explored, let’s be adventurous and get there by heading into the unknown. Follow the directions below:
Southwest to reach the Murque River
Northwest (path turns north and runs along Murque River)
The words "bandit camp" are admittedly vague when it comes to conveying size, but if you were expecting some large, possibly fortified, multi-encounter affair, you’re bound to be disappointed with what you find here. Instead of anything quite so extensive, this are consists of five bandits - including one named Shortie, another named Berta and a Bandit Leader - gathering around their latest plunder.
Approach them with your tank (just in case) and the bandits will initiate conversation, with Shortie proving himself decidedly inept at his assigned task. While violence at first seems inevitable, the Bandit Leader smells another opportunity and recognizes your authority. One must doubt their sincerity, but if you push on through the first two dialogue options (what you choose doesn’t matter) they’ll offer to join your service. They see little difference between you and the Stag Lord, and hence little difference between being "bandits" and "tax collectors", which matches quite well with Oleg’s opinion on the matter, ironically enough.
If alignment is any indication, the [Lawful Good] option is to put the bandits down by force. The [Neutral Good] option muddles matters considerably by allowing them to join you if they "straighten themselves out and quit banditry". The [Chaotic Neutral] option is to command them to leave your lands and never return (which they surprisingly listen to), and the [Lawful Evil] action is to accept them into you service so long as they understand that any "taxes" they collect belongs to you. Finally, the [Chaotic Evil] option will also allow them to enter your service… provided they kill Shortie first. This will initiate a fight with Shortie against both your party and the bandits.
Should you choose to eliminate the bandits instead of fighting them, simple spell buffs (Bless and Prayer) should suffice to see you to victory. They’re nowhere near as strong as the last group of bandits you fought back in the "Lone House" area, and you can easily out-muscle them in a fight. Your reward for victory include the Bandit Leader’s Bastard Sword +1, and Light Shield +2, Berta’s Shortbow +1 and Shortie’s Shortsword +1 and Masterwork Shortsword, among other weapons and trinkets. It’s bound to be worth a few hundred GP, all things considered.
In addition, no matter what choice you made you can help yourself to the stolen goods contained in various chests and crates near their almost certainly plundered wagon. These include a Wand of Cure Light Wounds, a Masterwork Heavy Mace, two Scrolls of Haste, and Torag’s Pendant, among other, less interesting miscellaneous items. A more obscure treasure can be found to the southwest of their camp in the form of a tree stump [Perception 25] which can be looted for some gold.
Deal with this event however your alignment dictates. Whether you’re a remorseless exterminator of bandits, a baron who believes in the reformation of criminals, a merciful ruler who is willing to accept the exile of bandits (not in my backyard, right?) or an unscrupulous ruler who is willing to accept the vilest of servants so long as they recognize you as the boss… all these options are available for your expression, depending on how you wish to flavor your rule.