This mask salesman is anything but happy...
One of the strangest individuals Link has ever come across, the Happy Mask Salesman is a seemingly meek, polite man enamored with collecting and trading masks of various styles and rarities.
He seems normal enough for a businessman, until you notice the fact that all features of his face are comprised of a single, unmoving texture map – perpetually locked in an eerie grin. He just may be wearing a mask himself. Things get weirder when you see him move for the first time... or don't see it, for better understanding. He erratically switches between a series of set motion loops, and you never actually see him transition from one to the next. For example, he could be rubbing his palms together in glee over the prospect of a new mask for his collection – the next instant, thrashing his head about violently, his hands on his forehead in woeful anguish. That's one serious muscular tic he suffers from; it's as unpredictable as his moodswings.
The madness slowly showing itself
In Ocarina of Time, he runs the Happy Mask Shop in Hyrule Town Market, selling and trading masks that Link must collect and advertise throughout Hyrule. If Link sells a mask and turns up shortchanged to pay him back, his face twists into a demonic frown, complete with glowing red eyes, before he angrily kicks Link out of the store.
He plays a central role in Majora's Mask, the titular facial decoration was an ancient tribal mask used in hexing rituals. The Happy Mask Salesman had just accumulated the treasure, when a lonesome and mischevious Skull Kid swiped the relic as he slept, putting it on and unleashing a demonic force within. He helps Link come to terms with a series of cursed masks in his possession, which allow him to take the form of a Deku, a Goron, and a Zora, the three major non-human races in Hyrule.
He made a short cameo appearance in Oracle of Ages, as part of a trading sequence.
Pedro's thoughts: The Happy Mask Salesman might easily be one of the creepiest characters in all the Zelda mythos. Think about it for a second. In Majora's Mask, he is overjoyed that he has obtained a rare mask used in demonic rituals. He also knew about the mask's powers and was very desperate to get it back. Sure, the excuse is that the mask would cause chaos and destruction and needed to be stopped... But, what if HE wanted the power for HIMSELF?
Then there's his personality. Like Andrew stated, when you first meet him he is quiet and polite, but as the story progresses his true nature begins to show. He is very quick to anger and expresses it in the worst way possible.
And then there's the scene that occurs if you fail to save Termina on time. After witnessing the destruction of the world along with Young Link's death, you get a black screen, along with a very disturbing chuckle, along with the following words...
You've met with a terrible fate, haven't you?
The fact that he is so calm about your demise makes him very disturbing. He also knows that you have been killed and returns you back to Termina, no questions asked.
And that's why the Happy Mask Salesman is so disturbing. He poses as a charming and eccentric man who loves mask collecting, but underneath lies a cold, somewhat manipulative and even demonic man whose path is ridden with destruction.
It doesn't help that he had an uncanny resemblance to Zelda creator Shigeru Miyamoto...
Uuuuh...