They hide in the pipes and in the corners. The live underground and the drain in the floor is how they get into the basement. Do you see the scar on your Uncle Dons leg? That's from a troll. He didn't listen to your Grandpa and me when he was about your age. He decided, one day, that he would go into the basement just to check it out. Uncle Don didn't ask Grandpa or Grandma to go down stairs with him. It was dark and he couldn't see. He walked by the drain and a troll reached up and grabbed his leg. He screamed and luckily your Grandpa heard him. Grandpa ran downstairs and turned the lights on. The light scarred the troll enough that it let go of Uncle Don's leg. But Uncle Don still has that scar on his leg to remind him of when he didn't listen to his parents.
Of course there were no trolls in my grandparents basement. The basement was actually my Grandpas workroom. It had all his tools and toys. There was a drain down there hidden in the corner. It didn't have a cover over it and it would have been dangerous for a little kid to be playing in the basement. And of course, I didn't know this until I was about 10 years old. My Grandma told me this story when I was about 5 years old after I disobeyed my parents and went to the park all by myself. After she told me about the trolls, I very rarely disobeyed my parents again.
In Native American culture, many stories teach a lesson. Many times these stories are aimed at children to teach them about things they aren't supposed to do. There is often a trickster figure that learns the lesson for the child, but the child learns the lesson through the trickster's mistakes. These stories are passed down between generations and have significant moral values attached to them. They work great with children because these stories are shocking and a little scary. They stick in a child's mind and teach them lessons by giving them examples of consequences the could face for their actions.