Arm the Wards!

the wretched fiends drop the manadust you need they are just west of the questgiver 45,30
the red crystal is behind the house at 46,35
rightclick on the dust and your done ;)

The Crystal Ward is a quite large and red crystal and is always located close by a building.

Before you can "energize" a crystal ward, you have to kill the "Wretched" to get their mana remnants. They Wretched are not within the quest highlighted area on the map, they're around the area of the map that says "Dawnstar Village". They look kind of like undeads.

After you get 4 mana remnants in your inventory, go back to the quest highlighted area on the map and find a large red crystal. Stand near one, right click the mana remnants and you're done!