There's a level 2, with no reward for it whatsoever
I don't remeber level 2, but you're probably right.
A volcano, with little reward
The Volcano can be farmed correctly, however there is a high risk of fire orcs and it is very difficult to escape from. Red, Magenta, Black, and I think orange dyes can be found. Also money is very easy to get from here. But going in alone is very risky and with a friend can cause someone being killed.
A cave, with nothing but an dynamite orc in a pit
If I remember where the cave is correctly, then it's currently broken.
There's also the bottom of the ocean just off the docks from port town. There is: money, Blue, and Yellow dyes there; but the sea monsters are very difficult to fight so don't go alone here.
The Swamp next to the woods is probably the easiest to farm but money is harder, the enemies are weaker, and you can only find Cyan dyes here. But still worth going to if you need some easy money.