I completed this portion of the cleric epic quest with my 54 cleric, a 53 warrior and a 53 enchanter. A little overkill since the Spirit of Flame is only a 40th level mob, but we were bored.
We headed to 3600, 0 which is at the far north end of the map, dead center. You will see a cabin up on a grassy hill. Shmendrik Lavawalker was standing there in his red robe. I handed him Lord Bergurgle's Crown, and immediately Natasha Whitewater spawned and began casting spells. We couldn’t see WHERE she spawned, but we saw her spell casting emotes so we just stood back and waited.
After about a minute, Natasha came walking from the cabin (I still don’t know exactly where she spawned), walked up to Shmendrik and started beating on him. She conned dark blue to me, Shmendrik was green. We stood back and let her kill him. It took about 2 minutes. When Shmendrik got to about 10% hp he started to walk toward the lake. I rooted him to keep the action in our area. Natasha cut him down.
Immediately A Spirit of Flame spawned over Shmendrik’s corpse. It started beating on Natasha and she fought back. I have heard you DO NOT want Natasha to kill the Spirit, so our tank jumped in and pulled aggro from the Spirit. Our chanter mezzed and mem-wiped Natasha just to be safe (I think if you get the Spirit away from her she will not pursue, but we didn’t want to take any chances). We easily hacked down the Spirit and I looted a Damaged Goblin Crown. I turned the crown into Natasha and she gave me the Ornate Sea Shell. Natasha despawned.
P.S. Shmendrik Lavawalker is on a three hour timer so to spawn Natasha you'll have to wait for him to pop.