Welcome to the first area of Challenge mode. As soon as you load into the area, proceed straight ahead on the left side of the fork into the first room. Kill the monsters in the first room, and ignore the button that lets you get the boxes behind the fence, as there's no need to get them. Go into the second room ASAP and kill the monsters there. Get the boxes if desired.
At this point if you have four players, the two most powerful players should wait next to the log (if you have two Hunters it should be both of them, but if you have more than two it should be the two most powerful Hunters) and two players should proceed into the next room. Go left and break the boxes to reveal a button that will unlock the laser fence. DO NOT KILL THE ENEMIES IN THIS ROOM, unless they will kill you while you're standing on the button. While one player waits on the button, the other should run into the now open fence area and hit the other button, and then run out. This button opens the log in the previous room, revealing the warp which the Hunters should now take. The weakest player should wait in the laser fence room by the purple door, while the stronger player should backtrack to the room with the log and take the warp. The player who stayed behind can now clear the enemies for EXP if desired, however they should neither get hit and waste Mates, nor get distracted from waiting for the door to open, which is why they are staying behind.
The players who took the warp must kill the enemies, then a single player should proceed through the blue laser fence once it opens into the next room and hit the purple switch, and then they should run back into the previous room and wait with the other players next to the yellow door. Once the purple switch has been activated, the player who waited in the laser fence room should proceed through the door and hit the yellow switch, opening the door for the players who took the warp. They should then proceed into the next room and hit the fence switch marked green on the map to open the barrier to Area 02. Once the yellow door opens, the players who warped should run straight through to the purple door and into Area 02. During this time all players should ignore all enemies.
Ignore the boxes in the first room as they are not needed. Follow the map into the room with the log, button, and laser fence. Once the enemies are dead, one person must step on the button, which will open the laser fence, however the fence is timed. After a few seconds it will close until the button is pressed again. There is not enough time for the player who triggers the button to make it to the fence before it closes, so a second player must proceed through the fence and take the warp. The player who warped will be transported to a small room with a warp in front of them. DO NOT TAKE THIS WARP. Instead, turn around and take the warp behind you, which will place you behind the log. Hit the switch to open the log for the other players, then take the warp behind you to reach the raised area. Clear this raised area to reach the boss warp, there are never enemies in the room with the boss warp like in the normal game.
One thing I often notice is that people talk far too much before beginning the Dragon and waste a good deal of time. (Sometimes nearly, or possibly more than a minute, which is quite a bit of time for Stage 1.) Do not do this. If you have more Mates than you think you'll need for the fight, drop the extras next to the boss warp and get into it. If other players need the Mates they will pick them up. If you have extra weapons, armour, shields, or anything else drop them by the warp as well for other players to examine. Once you've quickly skimmed through the items take what you need and get into the warp instead of asking each other who needs Mates for 30 seconds. JUST GO! It's only the Dragon, after all. In Challenge mode it is not possible to force the boss warp to activate, unless all players enter the warp the fight cannot begin.
BOSS FIGHT: Dragon
As soon as the fight begins, run forward to avoid being attacked by him when he breathes fire. Attack his feet until he falls down, but be careful that he doesn't fall on you and kill you. Forces and Rangers should make sure they are NOT in a position where the Dragon can fall on them, and Hunters should be fully healed to avoid death. Attack his head while he's on the ground until he starts to stand up. Immediately move back to his feet and attempt to knock him down again before he flies to spit fire. If he does manage to take to the air, avoid both the fire and getting crushed when he lands.
Once the Dragon roars and begins his burrowing phase, run to the edges of the arena and run around the edge. It doesn't matter if you run clockwise or counterclockwise, but make sure all players are spaced out and not running near each other, or the Dragon may tunnel towards one player and miss him, but hit the player running behind him instead. Note that the burrowing attack does 40 HP of damage, Forces will most likely need HP Materials to not get 1 hit KOed by this attack should they get hit.
Once he comes back up, all players must stay behind the Dragon. If all players stay behind him the Dragon will continue to walk around trying to target someone so he can breath fire, and you can attack his feet during this time until he dies. If someone gets in front of the Dragon it will cause him to breathe fire and then fly/burrow again, which gives you a chance to get killed and wastes a large chunk of time as well. Also note that once he dies and falls over, if you die from being crushed and you don't have a Scape Doll it will cause you to fail the stage, so don't get crushed unless you have a Doll still. ;) That's Stage 1!