There is no understanding of electricity hence no understanding of magnetic fields among the citizens of Yliakum so forget about it.
Where did you get this information from? I like the whole "science in Yliakum", and there must be other sources than Jayose and different NPCs.
Also, to understand magnetism, you need mathematics (to describe the field etc) - and even without the understanding the construction of a compass is possible. You do not need to understand electricity to understand magnetism.
… the Crystal emits a magnetic field that can make the use of compasses (and therefore minimaps) feasible within the game. Since it's a transparent biga$$ rock that glows because it's also radiactive, why not make it magnetic too? Until then, East Hydlaa is East Hydlaa, "North" Hydlaa is Upper Hydlaa, and no such thing like North, East, West or South for me. Sorry, but I can't cope with that.
Just because it emits radiation (in the form of IR and visible light), it does not have to be radioactive.

And there are some topics around in the forum discussing the feasibility of a compass or deal with navigation.
Also, before the fear emerges that the big crystal mutates everything in Yliakum - that should be the least of the problems, given that the "sun" is inside the atmosphere in Yliakum. If it really emits enough energy to turn molecules into plasma (see: being crystaled), this would mean it is surrounded by a plasma cloud (maybe source of the light). But it would also mean a heatsource so large that Yliakum's climate would be tricky at best: what we know as clouds would raise into the air until it is either turned into plasma or condenses on the dome, where it would be enriched with minerals (sulpur, lime, iron, etc) befor falling down again (or flows back into rivers etc.).
Since the lake is the sink, most of the minerals would end up there, strongly influencing it's ecosystem. This is of course speculation on my part.
Another problem is how the stone around the big crystal (it needs to be embedded somewhere) absorbes the crystal while still holding it in place/be stable enough to form the dome. Sulpur enriched rain is bad enough, there is absolutely no need for lava occasionally dripping down from the ceiling (dome).