Tell me, have you been cleared 2nd layer yet? In my playthrought, after Oscar chased Leah to the village I also go there quickly. When I entered there, speak to Leah and she MUST still sane/not being fed by granny yet (if you can still talk to her or gift her then she is okay), after that go purchase rotten sausage in the item shop => give it to a pig inside one of the villager's house => you got dried wheat. Now tricky part, there is a lone cottage located southeast (there are patrols, if you get caught you need to try again.. I use Clouded Eye potion to sneak by them). Inside, interact with fire place to burn the wheat and proceed to sleep inside a house where you can take a nap. Wake up, go to granny house, to the prison underground and Oscar must still alive there.
OR, you can just kill granny with that 3k HP then save Oscar instead roundbout I did to distract villagers