Devil's Drink

The local bar.

Drinking here
You can drink here for $7. It gives you the Tipsy status effect.

The secret arena
Once all-knowing-hobo tells you about the arena, you can approach the barman and tell him the code phrase. If done correctly, they would allow you to go through the back room, accessing the underground arena.

Once you talk to the organiser, you can access the arena at any time. You would always face one of the following enemies:
 * Highwayman
 * Bandit Girl
 * Wildcat
 * Lin-Lin (rarely)

They never drop any loot, and have no post-victory or post-defeat scenes; instead, you receive $100 per victory. There's no upper limit how many you can face, and you can't be reduced below 1 point of stamina, so if you can defeat your enemies before they defeat you, you can continue fighting even beyond that.

Being defeated while Aroused would also result in you being forced to publicly masturbate, otherwise.