Upon entrance the inn, Larze (an ogre) will hail you then attack. It is possible to persuade him that you are not the people he is looking for, in which case he will walk away and check a photo to see if it is you are not and ask you to stay where you are while he checks. He will never actually return if you persuade him you are not the target though.
For the Isle of Balduran quest on Tales of the Sword Coast, you will need to enter the Blushing Mermaid and get the drink 'De'Tranion's Baalor Ale' from De'Tranion. Giving this drink to Captain Tollar Kieres in the Counting House will allow you to retrieve the Sea Charts required for the sea journey from Ulgoth's Beard.