Theon has just finished sacking a fishing village. He questions Benfred Tallhart (another one of the Flower Knight's relatives) but Benfred isn't saying anything so Theon orders him killed. There's something about GRRM weak characters who can't do their own dirty work.
Uncle Aeron Damphair is the one sent to keep an eye on Theon, but Theon goes running off to Dagmer Cleftjaw, who is to Theon as the Hound is to Joffrey: the disfigured bodyguard/teacher. He's got a dastardly plan and appeals to Cleftjaw's pride to help him, but Cleftjaw sees right through that and knows it's Theon's pride that his injured.
The plan: defy Daddy's orders and leave the pillaging to Uncle Aeron and send Dagmer to beseige Torrhen's Square. Not to actually capture it but to draw out Stark forces, leaving Theon to take the real prize. No guesses what he means to do: it's all set up very neatly. Jojen has predicted the sea will attack Winterfell and Theon from the sea is going to atttack something. Hmmm. But this is GRRM so whenever anything looks predictable the reader should be suspicious...
By the way, Theon seems pretty annoyed at the way he was looked after at the Starks. I think Ned must have made him sleep in the cupboard under the stairs.