Im looking for a film i watched as a kid

There was an old film i used to watch on VHS. I have a vague recollection of it. I cant remember the title or who starred in it. I believe it was stop motion with goblin type creatures, a key line i remember was “THERE IS NO OUTSIDE” and two characters noticing a fire bucket and wondering why there were no flames out the top. They were quite small people. If anyone knows what this might be please reply. Its annoying me. Haha thanks.

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