Okay, don't know why, but this item and replies intrigued me to the point of looking hard for something, specifically Doreen Valiente's ABC of Witchcraft (which is awesome, highly recommended, if only for gaming ideas.)
Holed stones, sometimes called Holey Stones or Hag Stones (see below), seen as a feminine symbol/birth portal, so representing life and good luck. Called Hag stones because they are reputed to protect against witch's spells. A holed stone hung at the head of a bed wards off the Night Mare, that is, a witch or hag sitting on the stomach of the afflicted (insert your succubus/incubus/astrally attacking witch/changeling, what have you, awesome beginnings). Also supposed to prevent witches from riding horses, which is why these stones were often tied to a stable key. Looking through it can reveal fairies under certain conditions (I'm guessing dawn, dusk, on a threshold, at the water's edge, on certain holy days and/or places, and other liminal borders and places.) As mentioned above, finding a holed stone reveals the favor of Diana (or some other goddess in your setting) and that one should pick it up and thank the spirit that led to it (perhaps facing some foul consequence for not doing it.)
So, yeah, a whole pile of plot hooks and sympathies. Hope that helps. Go to Comment
The characters are wandering through the bustling crowds of Lasopolis. A street conjuror is performing a simple summoning spell, something for the kiddies. A bit of odious purple powder in the fire, an incantation and out pops a saak-lizard or a muhmentarsh, writhing from the flaming brazier. But the conjuror has only a poor grasp of the arcane magical tongue. A few stuttered syllables could lead to Other Things coming through the brazier and giving the crowd more entertainment than they had paid for...