What Dogs Smell
The little wild people smell of dirt, sticks, and poison fruit. Two-legs are very worried about them so they must be dangerous, we will bark and chase them. It's fun to chase them but they taste awful (which is saying a lot for a dog, they'll eat nearly anything.)
What Common People Know
Goblins are hideous little thugs. They spring from the ground covered in filth and full of hate. They cannot create things for themselves, but they enjoy things made by others. They are angry magpies and cattle rustlers. Anyone who knows of an infestation of them would do best to kill the pests now before they gain the confidence to come and take your children and make them into Hobgoblins. They are the most common and pernicious demons left behind in the Time of Fire and Madness.
What The Spirits Know
Goblinhood is a punishment for those who commit the most horrible crimes. It is the final punishment for those too abhorrent to be allowed the final release of death and too dangerous to be exiled. Goblination is for enemies for which you have only disrespect.