Minikit #1 (Story Mode)
There are five of these banners along the path. The first is right at the level's start, the second is found just after scaring the owl, the third is in the river by the fishing spot, the fourth is in the horse pen, and the fifth is just past the barrier the horse smashes through. Bust up all five of these for a minikit.
Minikit #2 (Free Play)
Look for a hard-to-spot vine above the starting area. Blast it with magic to drop it, letting you climb into a cleverly hidden tree house area. Blast open the magic-locked chest up here to release a firework and a minikit.
Minikit #3 (Free Play)
There are five balloons anchored to the tree house (one is hard to see in the window). Blast them all away for another minikit.
Minikit #4 (Free Play)
Bust up the table in the middle of the tree house for some loose bricks, then build these into a turnstile. Rotate it to lower a piñata into the room, then bust it open for another minikit.
Minikit #5 (Free Play)
Use a tinderbox character to roast the chicken in the fireplace for another minikit.
Minikit #6 (Free Play)
There's a Mithril cage visible from the fishing jetty. Fire off a blast with Saruman to free a minikit; it will float toward you.
Minikit #7 (Free Play)
When you approach the cart the horse crashed through, a handle will appear. Yank it away with a flail character to free a minikit.
Minikit #8 (Story Mode)
Look for a target in a tree on the right side of the area. Shoot away the branches, then snipe the target to release a minikit.
Minikit #9 (Free Play)
In the back of the area is a small, dark cave. Use a character who can light up areas to enter and grab a minikit inside.
Playing for Time
Minikit #10 (Story Mode)
When you pick up the bow, shoot the target on the nearby crate. It will release a minikit.