Magic Woods are dropped by Ent Ancients and Ent Gods. Their drop frequency is similar to that of the Toxic Sewers so they are somewhat uncommon. For lower-level players, Ent Ancients provide a much safer access point to this dungeon than going up against Ent Gods.
Magic Woods are an alternative source for Speed and Dexterity, which drops at a common rate from the boss. It also provides the Fairy Dust consumable and an average Mystic Set which may be of use to lower-level players. They can also provide some low-to-mid tier equipment.
