Episode 4 Level 5

Sorry, had issues posting ....

I have built the balloon tower but the runestone and crystals still say that the way is blocked and for the life of me I can't figure out what I'm missing.

I just checked to see if there was so way a building's product could be blocking the way and there isn't anything. There is a bad guy you have to click away but I'm sure that isn't your problem. My ultimate recommendation is to quit out of the game and restart it and the level again. It's amazing how well that sometimes works for fixing a problem. Sorry I couldn't be of more help.