It’s a big, tentacly servant of the Old Gods in the Twilight Highlands. It gives you nightmares, then you kill it dead.
Alieth likes it because it’s a menacing, nightmare-inducing presence of evil.
Aeliel thinks it’s neat and even kind of adorable. (Have you seen its tentacles after you kill it? They look so sad. Poor thing.)
PS. How could you let them die? It’s all your fault.