With her third adaptation--the others were The Kitchen Knight and The Vinlanders' Saga--Barbara Schiller emerges as an uncommonly sensitive and versatile storyteller, as much attuned to the gaiety and wit of this French fairy tale as she was to medieval heroism or Norse fatalism. The story is a twist on a familiar theme: the lady rat transformed into a real princess (""a little too pink of eye, a bit too white of hair"") demands of her father ""the most powerful husband in the whole world."" Each of his suggestions--the Sun, the Cloud, the Wind, the Mountain--is dismissed in turn: ""No, there is someone who nibbles and gnaws at the Mountain as if it were a piece of cheese... In a word, there is the Rat."" With regret-- ""but a promise is a promise""--the King and Queen ask that she be changed back into a rat, whereupon she is wed to a splendid gray gentleman rat, and ""they (make) their home in the largest mountain they (can) find."" Complementing the verve of the telling are the piquant illustrations, as attractive as any Adrienne Adams has done and perhaps more imaginative in design; Oriental overtones make the mountain a particular marvel. Children will be listening and looking with pleasure for a long time.