Link will reappear near the King of Red Lions, outside of the dungeon. Medli and Komali approach Link. Komali apologizes for mistrusting Link and gives him his most valued possession - coincidentally, it is none other than the Din’s Pearl .
By "use the wind god’s wind", Valoo meant he wants you to learn the Wind’s Requiem. You should’ve already done that (if not, check our earlier Dragon Roost section of the walkthrough). After talking to the King of Red Lions, he reveals that he suspects that Ganondorf sent the monster here. Therefore, he may have done something to the second pearl, located south of here.
Now, you COULD leave. However, there are a few things left to do as side-quests. First, return to the ledge. I believe the mailbox may be shaking (at least, I put something mentioning a mailbox in my notes). If it isn’t wait until Forest Haven. It, if shaking, should have a Piece of Heart in it.
Second, go into the hollow. Go to the mail sorting section and play the mini-game. Not only can you get many Rupees, but a Piece of Heart after a while. Finally, one of the Rito on the second floor (I think beside the room you met Medli in) wants some Golden Feathers for his girlfriend.
Once you are done with any business, head to the King of Red Lions. Switch the wind direction to the south by using the Wind’s Requiem, then enter the boat. Activate the sail and begin sailing. After a short time, a talking fish swims by. The King of Red Lions stops.
The fish comments on your Sea Chart and then offers to draw a map of this island on it. He also gives some information about the island. His brethren will also do this, if you put some All-Purpose Bait on the water while near them. They leap out of the waters near an island. Try to make a habit of mapping islands, or you’ll get lost later in the game. After mentioning something about a debt to the King of Red Lions, the fish leaves.
Continue sailing south. You’ll come across a few islands. I’ll give some details on them. Also try to map them.