Activate Switch I to lower the spikes in your path and continue east.
If you have a Steel Key, you can reach the chest in the lower-left corner of the room by activating Switch II. Remember to deactivate it afterwards to continue on!
Once you have the Hammer, you can create a shortcut through this room (which will come in handy for reaching the secret boss).
ENEMIES:
Copper Fish: Two waves. (must be cleared to progress)