Go down the first set of stairs and head west (passing one of the small armos statues as you go - they take just one arrow to kill) and fall off the ledge. On the little outcrop fall down the ledge to the south, then fall off the ledge to the west. Continue west and fall into the pit where Sahasrahla is. Go inside and talk to him.
Sahasrahla tells you of the knights of Hylia, who guarded the pendant of courage. Most of the knights were killed in the war when the seven wise men's seal was made. A hero must appear from the remaining descendants.
He then gives you the Pegasus Boots. If you hold down the A button for a few seconds, you'll dash forward in whatever direction you're facing. You'll continue to dash in that direction unless you turn and face a different direction or press a button besides A.
He also advises you to check out the east side of Lake Hylia for a useful item. We'll be doing that later.
Also, although it doesn't say so specifically, he marks the locations of the remaining pendants, as well as the Master Sword, on your map.
Now that you have the Pegasus Boots, if you see a wall that has a lot of cracks in it, just like the one in the north wall of Sahasrahla's hut, you can dash at it and it will open. This doesn't work for all cracked walls, but try it on some. I'll tell you which ones you can open with a dash.
So, pick up all the pots in Sahasrahla's hut, then stand a little bit back and face the crack in the wall, then hold down the A button until you dash. You'll ram into the wall and the crack will break open. Go through for 100 rupees and three bombs.
Leave Sahasrahla's hut. Take a look at your map with X. You see a pendant in the desert to the southwest, a pendant in the mountains to the north, and the Master Sword in the forest to the northwest. Your first goal is the desert pendant, but we have to take a quick detour before we go there.
From the hut, go up the stairs, around the left side and down, and continue down through the narrow pass. Pass by the statues and octoroks, head down the stairs to the bottom left, down through the arches, and down through the mountain pass.
Now that you have the Pegasus Boots you can also dash into trees, sometimes causing things to fall out. A fairy may appear, apples may fall, or you may even get attacked by a swarm of bees (run to another screen to get away if that happens). If you need hearts, dash into trees to try to get a fairy or apples to regain some life.
Also, from the entrance to the Eastern Ruins there's a fairy fountain slightly to the east.
From the Eastern Palace ruins, go west, then down the bridge to your left, and start the long way west. After Link's house, the way continues southwest. You'll have to go south and then west around a forested area from there, heading northwest to get to the next screen. From there just take the exit west.
The music will change, letting you know you're back in Kakariko. Head west, up between the two ledges, then up the ladder to the library. Inside, you see some plain old bookshelves (can't read anything there unfortunately) but you also see a green book sitting on top of the bottom left shelf. How to get it down? Ram into it! Use the Pegasus Boots with A to run into the shelf and the book will fall. Grab it.
This is the Book of Mudora. If you stand in front of something that has the ancient Hylian language on it and press Y, you'll be able to read it.
Now from here, head back to your house. It's not hard to remember how to get there, right? In the screen where your house is, exit south.
In this swampy place with wet grass, head south and take the southwest exit. From there, exit south.
In this screen there's a weird kind of palace thing to the south. Go inside.
To open the chest, push the left and right blocks up, and the middle block to the side. The chest contains three bombs.
Go back outside then back in again, and this time push the middle block up, and either the left or right block to the side to get past the barrier and go through the door above.
In here, watch out for the bubble, and pull the far right switch to open the floodgate. Now go outside and reap the reward of this simple action: a piece of heart in the shallows! There will be a fish or two flopping around, if you pick one up and take it north to where there's water and throw it back in, it might reward you with some rupees.
Go back to the screen with the floodgate palace. You'll see what looks like a rabbit jumping in and out of the swamp grass below the palace, and you can catch it by cutting the grass below it when it jumps. Be careful not to accidentally kill it. Once you cut the grass, it won't be able to hide in the grass and it will fall. Talk to it and it will give you some kind of reward, either a heart or a fairy or something else.
From here, exit west. Follow the path around to an exit going west (the cave on the way is a fairy fountain).
The quick way to get across the desert is to walk up against the south wall as you walk in, then dash west. You'll go right across a mine in the ground that explodes after you run past. Once you see the ledge with two black rocks on it, head north.
You get to a platform with three weird statues on it, and a kind of pillar in the center. If you try to read it, you see a bunch of weird symbols and things. This is (supposely) Hylian! So, break out that Book of Mudora and start reading.
A weird cutscene takes place in which the Sanctuary music plays as Link makes a wish and looks up at the sky full of awe. The three statues circle around so they're no longer in your way of the palace entrance. Go inside.