I've just noticed something about the candy grab event - maybe a small detail but it raises serious questions about game lore!

The zombies that are encountered during the event have the tendency to lose their heads and continue walking around. This suggests that they are animated corpses and not the traditional plague zombies.
This means that someone or something is animating them.

At first the logical assumption is the witch, who can be seen enchanting massive pumpkin golems to great effect. The witches, however (all three) engage in benevolent activities and bestow items on the players in return for their work in game.

Tristam, the king, is a suspicious character as well - he had not been seen for years, then suddenly (seemingly overnight) the castle was renovated and he had returned. Not only that, the king had access to vast wealth and began rewarding players for obtaining creature and humanoid bounties throughout the land. The king has not been seen or noted to use magic, but is known to have access to powerful magic items. As such, it might be that the kings powers here may have come from a wishing ring or the discovery of a genie.

This leaves the question who has raised the undead army that besets the world every year? Is it Sardon, the powerful wizard who hasn't been seen since ages past? Is it a supernatural force that is also responsible for the harmless ghosts that appear? Cultists from York that seek to overthrow the crown?

Who else could it be?  

you're so right - i never noticed this about zombies!
but we're forgetting a key figure here... Undine, the Queen of Graal, who's the only NPC in Classic to be put in jail, which means she has a motive... Revenge! and i mean, come on, of course the Queen of Graal has to have magic. i think king Tristam has too many responsibilities to raise an army of the undead anyways....  

I thought Tristam is married to Iseult?

The plot thickens...