Let you open doors. Unlike the gems in keen the other keens, the keys in Keen Dreams stay with you when you die, unless you use them from level to level and can be used on any door. For Keen GBC, the keys are distributed throughout the level and are important to completing the level, but are also color coded.
These little people are from the secret level in episode five. They just push you along. One shot stuns them. Some people call them Goplats, Scotties, or Koraths. They got the name Goplat from the well-known error that closes the game in easy mode in version 1.0 upon the entry of that level, but Goplat actually refers to a platform that follows a specific path, which is what caused the error.