Lost Chao Locations
Locating the Ancient Ruins:
In the area you start the stage in, aim to climb to the top ledge area that is above you. You will be see four metal boxes. Break these open with your Iron Boots and they will reveal a mural on the wall. Dig into this, and it will take you to a room with the Ancient Ruin.
Finding the Lost Chao:
Activate the ruins with the Mystic Melody and the door in front of you will open revealing a teleporter that will take you directly to the Lost Chao.