Well the red stones you need to talk to yeah, but they lie so you have to do the oposite of what they say.
Next thing, if it says the treasure isn't there, then IT IS THERE talk to it again to receive it, it's a Three Stars yeah.
Well than you can follow the other hints:
'Take a break at the railroad bridge'
Well, he hints to the many draw points around the world that are located on railroad bridges.
'Take time off at the Eldbeak Peninsula'
Go to the Eldbeak Peninsula, which is located north of the Balamb Continent. Check around it for a stone which says:
TRETIMEASUREATMINOFFDEISLE
Take the clue literally, and take out the words TIME OFF from the stones. It should now say TREASURE AT MINDE ISLE. Minde Isle is located south of Esthar, and you'll get a Luck-J scroll for your effort.
'Back in the day, south of here, there used to be a small but beautiful village surrounded by deep forests. Everyone lived a happy life there'
In Centra, there should be a forest with a round grassy clearing in middle of it. Inspect it, and Squall will mention that there's a lot of rubble around. And the best thing is... there's nuffin here