Chapter 2
First use the Mouth key item on the bucket of Blue Paint hidden at the backstage of Holmes' House.
Next, use the Mouth (now with a Blue Tongue) on the Moon while it is up in the sky on the streets just outside Holmes' House (you may need to move the Moon back if it is inside Wilhelm's House). You must do this before completing the ritual to free Mr. Glitch.
Source: neoseeker.com