I've gotten 7 out of 8 torches in chapter 4. I assume I need all 8 to beat the room where the old man says I need a big light. So I've been looping around the map vertically through the room with the ghost lady thinking that must have something to do with the last torch. I have no idea how to get into the two rooms directly above that room.
Also, you can cheat your way through the obstacle course by repeatedly tapping M after you get hit by an arrow.