I like the appearance of the creature, except im having a hard time picturing a fish creature with a magic wand hanging out of its jaw. Think maybe it should be explained why its able to use magic or why its inteligent enough to know how to.
The village sits on the edge of the deep fjord, often engulfed in mist or rain. Its people are fishermen, who work even through the sea-ravaging winter. And they pray to the gods of the deep.
At the beginning of every winter they hold a summoning ceremony. Three boats are taken out into the fjord, a hornsman on each. The mournful horns are blown in the language of the whales, the gods of the deep. The whales sometimes appear in answer to these calls, and it is taken as a good omen when they do.
To a party of PCs wandering the misty hills and valleys nearby however, the doleful whalesong of the horns can be disturbing and misinterpreted...