They are either a vastly powerful and ancient race that can only manifest in our reality as mushrooms. Or intelligent mushrooms with epic headgear. Your choice.
When I first met these guys, I just thought they were some variation on plant people. They were the only plant-like NPC's I've encountered. It was because of these guys I've avoiding being a Floran. I guess I was just misguided; I'll have to look further into this species in the future (maybe a multiplayer server).
The Agarans are awfully weird, they more or less look like they're behind QUITE a bit more than what you see them doing regularly. Even if my Floran walks up to them they do nothing though.