I would again like to suggest setting off towards the nearest settlement to train. Li is just short of 6th level now (That sure snuck up on me!), and I would assume Tormal is roughly around the same (we tended to have nearly the same total. I know Ceru was approahing 6th just as Li made 5th, so I would think he would be well on his way to 7th (but maybe not quite there). After hearing about the last session, I really think we need to train to be able to do this. I know we also need to save people, but we will be better able to save them if we are more powerful. The gnolls are going to hurt people no matter what we do, so we might as well take the most of our advantages and try to come back stronger. This might also make it easier to bring in the new PC.
It's also worth noting that while we train in a town, if that town is in an area threatened by the gnolls, we effectively defend that town. Just by being there, we are helping people avoid the gnolls. So even if we aren't hunting gnolls, we are doing some good.
After training (or if we don't train), I think we should try to track down the group of gnolls we've already encountered. We have a good idea how that group works, and Li want's his nagamaki back. With more time to work with, and more powerful characters, I think we might stand a chance. We could take more time putting a plan into motion, and we have better intelligence on what to expect.
So basically, I say we train, then hunt down the gnolls we've already met.