Nope, you don't have to free the queen. She says create a diversion, but no one has found anything she thinks is an acceptable diversion (I guess she really fools us, and sends us on our own diversion
)She is in the away camp (in a mountainside cell, to the right of the kings tent), and you get the key to here cell from the king (by killing or stealing). Once she is free, I think her only useful purpose is Exp points (and loot ) if you kill her (no bad side effects that I know of).
Yes, the teleporter to the bomb is in Rapx castle, in the kings quarters. Stick close to the walls (not too close, since one of them you actually can walk through) and you will find a small keyhole. In the castle (I believe) you find the key to this keyhole ... it leads directly to the tower.
You don't *have to* disarm the bomb (I recommend playing that ending at least once), but it does limit your ending choices to one (which is, IMHO, the worst ending).
Tools for Wizardry(r) 7