The spell seems to go off successfully, though it doesn't appear to have any effect, beyond a slight wisp of smoke emerging from the beast's nostrils.
((From the looks of things this may be a good time to enter initiative order; everyone may take one action this round in whatever order you wish to post; I'll resolve them in order.))
Is Valten using any gestures or words? If not, Aequi begins rapidly scanning the treeline for any hint of movement or new figure. And I have 0 OofH Lore also, but does Gossip give me anything? If I can find no other figures or signs around us, then I'm getting ready (although not throwing it yet) to cast DEO on what I think is the skinless man wearing someone else's skin.
Excellent point-- no, Valten is not using any words or gestures, nor making any other display of spellcasting. What Aequi does see, once he looks about, is an arrow buried deep within a tree trunk not far from where Sinmore's head was, moments before. The sound of its impact may have been covered by the loud grunt she made after being knocked to her knees.
As a consummate gossip, Aequi knows just about everything that goes on in any place he lives (and a lot of things that don't actually go on where he lives :p); fortunately in this instance, Valten had spent a bit of time at Gallus Florensis so you've heard AAAAALLL about him. When Liliana put out a call for young magi to rebuild the covenant, Valten showed up without any introduction or warning, and proceeded to behave with arrogance and condescension to everyone around him (huge entitlement issues; the guy's compensating for something, if the barmaid who visited Valten's bedchambers can be believed) before heading off in a sulk because he wasn't welcomed with open arms. He showed up, likewise unannounced, when the magi were in deep trouble, trying to enter the sanctum of Aislinn, a formidable elementalist hoplite; Valten saved a lot of people's lives just in the nick of time. Proceeded to wear out his welcome and travelled to Burnham (the only place in Stonehenge that has any Flambeau left), because he was afraid that yellow would make his skin tone appear too sallow (apparently he spends two hours of every day staring into a mirror, moisturizing and otherwise pampering his face and hair, if his maid can be believed).
What direction did Valten come in from? (Specifically the same direction as the bandits generally fled?)
The bandits had surrounded you, and when they fled, they scattered. Valten came from the opposite direction than the one to which Rhys fled.
"Shields up!" yells Aequi, as he begins circling to the left. "Beware arrows Sinmore! Attravere, Valten's flamboyant, even in spellcasting! Someone else is out there!" As soon as he's done yelling he'll stop moving to the left and immediately scurry in a crouch forward a few steps to change position.
((Sinmore is starting to feel bloody useless))
Sinmore stands her ground with her sword raised, ready to die if need be. Neither one has cast a lethal spell at the other, so it doesn't have to escalate more than it has, but just in case..."Creo Ignem!" she casts Blade of Virulent Flame on her Little Sister but says nothing else. At Aequi's warning however she ducks and starts looking for cover of some kind.
((What are her penalties at this point? By my estimation she should be at -6 for a Heavy Wound and Fatigue penalties.))
Thus, yes, it should have. 
Rhodri passes off the other thought as a mistake.
"You would defend demons and those who admit to consorting with them? And you would attack us after we were attacked unprovoked by them? The Quaesitores will be interested in hearing this."
"He will have proof enough when questioned under Frosty Breath of the Spoken Lie. Cease your aggression this instant."
((Can Rhodri see anything odd about this Valten with his Second Sight?))
Rhodri will move toward "Valten," shield and sword at the ready.
No... He looks, sounds, feels, and even smells just like the Valten you remember. Though his robes are a bit better quality than what he wore before, and that is a damn fine horse he's riding.
Valten silences Rhodri with a dismissive wave of his hand. "No time for your paranoia and baseless disrespect for my person and my station above you-- something is coming.". He draws a longsword from a scabbard at his hip, and wheels his horse about in slow circles, on the ready.
A young, beautiful peasant girl runs into the clearing, bodice and skirts torn and muddy, golden hair bedraggled, tears streaming down her face. "Mercy! Help me... Save me! There are creatures here, foul and unnatural!". She falls into a heap on the ground, crying.
Sinmore is starting to doubt pretty much everything that is going on around her. A woman changing into a lioness (though the wound seems real enough), bandits running in fear even after one was scorched by her spell, a beligerant Flambeau (well that wasn't too unbelievable) attacking her for no reason though after she asked for peace, and now a peasant girl running in like she was under attack? Sinmore cautiously approaches the girl holding her flaming sword aloft.
((What language was she speaking? I assume Welsh?))
Attravere motions Sinmore back from the girl. "Careful friends... this woman is not everything she seems to be."
(Does Attravere have any idea how far into the woods they are?)
With 1 in Area Lore: Wales? No clue 
(The more broad the area specified, the more general the information.)
(Was actually more wondering if they were deep into the nearest edge of the woods or how far in they were from open ground - if the only point of reference is where they entered how far back was that?)
((You've been traveling a forested path for maybe an hour.))
Rhodri is still at the ready, not sure what to do about either Valten or this girl. He is considering starting negotiation (which for him is with the point of his sword) immediately. But he's waiting to see what the others are doing.
Aequi is not going to give away his position again unless he observes something that he doesn't think anyone else notices so besides wishing he was a little more perceptive he's mainly analyzing the situation in the trees around them and awaiting anything else that might stumble in or interrupt while everyone else is dealing with Valten and blondie - i.e., he won't be reacting either unless someone trips over him.
Valten scowls at the attractive young maiden. "Foul temptress!" he cries. "Begone from this place, and return to the hell from whence you came!" With a might swing of his sword, the maiden's head falls from her shoulders and rolls along the ground for a moment before rolling to a stop at Aequi's feet. The eyes look directly at the invisible Criamon, and the face breaks into a charming smile.
The headless body bursts into roaring flame, and advances menacingly.
[size=85]((Initiative order has been established. Everyone may take an action, posting in nonspecific order; I will resolve all actions in order.))[/size]
Round 1: This turn, Valten will grab the demon's head and make his way into the trees. "The head must be buried in consecrated ground before the demon can be destroyed; try not to make too much a mess of it, amateurs," he calls out over his shoulder as he rides away.
((OOC: Hmm... very disturbing (but pretty!) smile - yeah, I'll count that as being tripped over. And yes, I'm making a baseless assumption about Valten. People can take it as they will))
"As good a sign as any. Thanks, not-Leona!" Aequi wide-gestures and screams his Lvl 10 DEO at the flaming body ((Perdo+Vim+Sta+2(gestures and voice)= 19, so Die + Aura + 19, +4 Penetration; will not be surprised if I don't penetrate)) and then quickly backs his invisible self up.
Rhodri will interpose himself between the flaming headless body an whomever it is going after. He will fight it with sword and shield with the intent of not letting it leave him. He is not hoping to destroy it so much as protect the other magi to give them an opportunity to use DEO until it's gone.
Sinmore stands side-by-side with Rhodri, ready to hack down the flaming body as it approaches. "What the Hell is going on here? Who is Leona? The two women back at the castle had mentioned something about Leona's wood. Is she a diabolist or something? And watch out for arrows, there's bandits still out there...the uh...the Criamon? Said he saw an arrow shoot at us."