I relistened to episode 27 earlier, and now that I've had time to actually process it, I want to examine that final desicion in a bit more detail.
Let's start with some facts about the monster:
It is intelligent ("It's not a mindless being like the one we fought in the Dreamlands, John, it's intelligent.")
It knows that its victims can free themselves using obsidian ("to know when to be silent, to guard obsidan so more of its meals won't leave.")
It knows where the only source of obsidian is
It knows John and Arthur have returned to the mines ("It senses you.")
It knows that they're in contact with the person they met in the shack, who I'm going to nickname Cave Buddy (CB).
We can safely assume that the monster has drawn the following conclusions: John and Arthur would only return to the mines to rescue the others, and that CB, having already freed themself, can tell them how to do that. Meaning that the monster knows that John and Arthur will be heading to the lair to retrieve the obsidian. So its most obvious course of action is to go there and wait, which is exactly what it fucking did.
Now some facts about the Cave Buddy:
They have survived down here for a long, long time ("They look pained as thay talk, as if they haven't spoken in a long time."), and have managed to evade the monster for that entire time
At one point the monster got close enough to attach a tendril, and CB still managed to get free ("Cut it out"). So it's been demonstrated that they are not completely helpless
They are small enough to fit through narrow passages and nimble enough to climb into the rafters, and they can do both of those things too quietly for John and Arthur to hear. They are highly mobile and stealthy
They have willingly stayed in the mines for a long time, at great risk to their own safety, because they want to free the others ("You haven't left because you want to help them.")
Their tendril has already been cut free, and presumably another one cannot be attached. Meaning that the monster won't bother trying to subdue them and will simply kill them on sight (which it did.) CB knows this.
It can be assumed that any decision CB makes takes all of this into account.
Everything I've listed is information that CB, the monster, John, and Arthur all either already know or have the capacity to deduce. And they're aware that the others know it, too.
So in light of all that, walking into the monster's lair without someone drawing it out first is effectively suicide. John and Arthur should have know damn well that the thing was gaurenteed to be in there because, as Arthur said, it knows to guard obsidian. Someone needed to distract it, and CB's superior mobility meant that they had a way better shot than John and Arthur.
Having CB serve as a distraction is not only the logical choice but also the compassionate one, because it gives them the best chance at achieving a goal they've had for a long, long time. It's dangerous, yes, but their continued presence in the mines and the fact that they literally fucking offered to do it proves that they are just damn fine with that risk.
Basically, CB was not a child or a pet in need of protection, they were a rational being who was trying to achieve a goal and who knew full well what they were getting into. Choosing not to have them provide a distraction was a poor decision.