I seem to be stuck at the first fight getting thwomped and not in a good way

If you decide to fight Arthur or head straight to the forest first, yes, you will die xD After chatting with the guy under the bridge to get the gold necklace, first avoid Arthur and collect money from 3 chests near your house. Then convince Peter, the stable boy, to flex his muscles, so the baker won't notice you stealing his cakes anymore. Sell the cakes and the golden necklace to the shopkeeper to buy 2 anti-poison necklaces and a sword. (Press F1 for Menu>Equipment to equip them to Lance and Jaime) Also, buy plenty of magic potions, and then you're ready to enter the forest. The game will reward you with NSFW scenes after completing certain story states :D