What is the effect on the narrative of the long passage of time covered in the third chapter?

This is very much the Shaper's chapter. It takes a long narrative to explain how important this character is to the story. The Shaper’s act of creation with words challenges Grendel’s solipsism and continues to haunt Grendel throughout the novel. Grendel hears a history of the village separate from his own personal history, and thus must face a reality external to his own self-created world. That the Shaper’s words touch his heart disturbs Grendel, who would rather remain self-sufficient and unmoved by this external world.