Once inside the dungeon run straight ahead and talk to the Moarself NPC.
You will now have 5 minutes to solve a puzzle by opening Presents, and find the matching item to open the door. This puzzle is on a 5 minute timer. You need to find all matching items, and can only make 3 mistakes. If you fail, you have to start all over again, and the puzzle resets.
"You have found a snowman. Find its match."
There seem to be at least 5 patterns starting from the far left (see below for a puzzle guide).
If you're with a group, only one person needs to solve the puzzle, the rest can follow when the door opens.
After solving the puzzle, go straight (in a side room is another Moarself cooking) and talk to Santa Sclavus (NPC) who tells you to use the nearby door to get a present
This door portals you into a maze area with Gumdrops, a variant of Knathtead. Hot Drop! You will immediately be debuffed and though not directly in the line of fire, the Gumdrops will quickly find you and start chaincasting
Go E, up a ramp and left, through a bigger long room full of Gumdrops. On both sides you will see imprisoned Moarselves
Optional: Lockpicking the doors and talking to these NPCs (they will disappear after this) will give you additional experience and luminance when talking to the Santa Sclavus NPC at the end of the dungeon.
There will be another ramp up with 2 Gumdrops and 4 in the smaller room below. You can imp and bludge vuln the Gumdrops from the corridor.
One of the will drop a Door Key, use it to open the door (resistance 1000).
Next is the Rolling Snowballs of Death part.
Look at the pattern, some will run from left to right, others from right to left.
You can follow directly behind one ball, to jump to the next row. Also, there is space between each row where no Snowball can hit you.
The exit is in the corner the farthest away from you (NE)
The next area is an area with Uber Penguins (level 240) and reinforced doors (diff 600).
There are 3 penguins in each section and one of the penguins drops another 2 use Door Key (Sclavus Santa's House). All keys look the same, but are only usable for the next 2 doors, to enter a safe area, and to exit it.
Above you are lots of Snowman Sentries, who keep cold vulning you and can war you from above in the Penguin rooms (and if you're unlucky and the door is open, in the safe areas too).
After 3 or 4 of such penguin-door-safe-door-penguin sections, you will arrive in a safe room without creatures. Run up the ramp and use the lever to open the door. You will now be in an area much alike the area after the puzzle, including a cooking NPC Moarself (NPC)
The door behind Santa Sclavus him will open upon his death (no need to loot as he doesn't carry items). There, you will find the real Santa Sclavus who will reward you with xp, luminance and a pet Gumdrop summoning item.
Note: The door will stay open for about 5 minutes. The NPC disappears after about 5 minutes after killing the Creature Santa, and will respawn when the creature respawns. However, only after the creature is killed, you can talk to him for your reward.
Note 2: if you have first killed the Imposter and talked to Santa, and then free the moarselves and talk again, you will not get the rewards for freeing the moarselves.