You can "solve" the Crazy Iven Riddle (Or at least get his quest out of your quest log) by
speaking to him, getting the quest in the log, then examining the large fish hanging on
the platform near him. This gives you the Firey Falchion (or something along those lines)
and removes the quest from your log. Though it may come back if you speak to him again. As
for the things he says, the words that are actual words seem to suggest the fish (once you
know about it). Treasure, Big Delicious, and the like for example suggest that there is a
treasure somewhere and that it has something to do with something big and delicious.
Though this could be rationalizing a bit and trying to make sense of it. But it is "Crazy"
after all...