You indeed need the permission from both the authors and nifflas too (he made the game, and he asked for the content to be made for this game.) I do agree with minmay here.
If you're going to use the content from KnyttStories after you've got the approvals, people will start to see your game as a rip-off, and that will deeply affect what people will think of your game.
If you just want to make a game, but you don't care if you aren't going to release it (so only you will play it as experiment) then you can take whatever you want. No one will find out that way.
You also have the option to start your game using content from other sources, and replace them at a later stage. This is a good way to find out if you're motivated enough to make your game.
Do remember, if you do this, get permission from the authors before starting to hand out beta's etc, or replace the content first.