Can you see the sparkle? It is just a couple of steps in front of Siela. There is a cave behind the waterfall. Ottssie hides in the end of the cave. Ottssie has strong resistance to ice, earth, poison, blind, silent and paralyze element. Its weakness is fire element.
To get to the waterfall, you'd have to break the stone block you find in Otts Fall / Lake. ( Here's how )