One person challenged me into a fight in grabad but i dont know where the battle is. can someone tell me where is it?

Try heading to the bottom of the city, and entering the large middle building.

Look for arrows on the ground pointing to a large door which leads to a stairwell.

I had the same problem at the begining, but now I'm stuck on
the "Tree" thing.

The Mock? Because if you are stuck in the Mock fight, then all you have to do is raise a good enough monster(s).