The Fair is located on the northern part of the area. This is where you get too chose your starter guardian from the three basic elements.
First, you'll have you're first "real" (not imaginary) battle when your friend challenges you. When your first get on the road to New Haven you'll be stopped by a thief, whose one guardian will depend on which starter guardian you chose (his element is the one that is stronger than yours). His guardian is a level 1.