So... Why exactly is the magician the main villain? Up till that point, you were facing the invading forces of the underworld. Is there some sort of connection between the underworld and the magician? Why do rayman&co go back to relaxing after the magician is defeated if it doesn't solve the underworld problem?
The Magician put a microphone in the Snoring Tree, specifically so that Rayman & Co.'s snoring would wake the dead. So he's The Chessmaster. As for them going back to relaxing, I guess that the game assumes that you did the Land of the Livid Dead bonus world.
Nah, that's the setup for Legends. Turns out the nap lasted a hundred years.