DISEASE CHARACTERISTICS:
* Diagnosis of neuroblastoma either by histology and/or demonstration of tumor cells in the bone marrow with increased urinary catecholamines
* High-risk disease, as evidenced by ≥ 1 of the following:
* Recurrent/progressive disease at any time
* Refractory disease (i.e., less than a partial response to frontline therapy)
* No biopsy required
* Persistent disease after at least a partial response to frontline therapy (i.e., patient has had at least a partial response to frontline therapy but still has residual disease by MIBG scan, CT scan/MRI, or bone marrow)
* Biopsy of at least one residual site demonstrating viable neuroblastoma required
* Patients must have ≥ 1 of the following sites of disease:
* Measurable tumor, defined as ≥ 2 cm in at least 1 dimension by MRI, CT scan, or x-ray OR ≥ 1 cm in at least 1 dimension by spiral CT scan
* For persistent disease, a biopsy of bone and/or soft tissue site seen on CT/MRI must have been done to demonstrate viable neuroblastoma
* If lesion was irradiated, biopsy must be done ≥ 2 weeks after radiation completed
* MIBG scan with positive uptake at ≥ 1 site
* For persistent disease, a biopsy of an MIBG-positive site must have been done to demonstrate viable neuroblastoma
* If lesion was irradiated, biopsy must be done at least 2 weeks after radiation completed
* Tumor cells on routine morphology (not by neuron-specific enolase staining only) of bilateral bone marrow aspirate and/or biopsy on one bone marrow sample
* Patients enrolled in group I may have had a prior relapse or progression, even if they have no measurable or evaluable tumor sites at time of study entry, including any of the following:
* No tumor sites on all evaluations
* Non-measurable tumor on MRI /CT scan and/or measurable tumor on CT/MRI that was previously irradiated
* MIBG-avid site that was previously irradiated
* No CNS parenchymal or meningeal-based lesions
* Skull-based tumor lesions with or without intracranial soft tissue extension allowed provided there are no neurological signs or symptoms or hydrocephalus related to the lesion
PATIENT CHARACTERISTICS:
* ECOG performance status 0-2
* Life expectancy ≥ 2 months
* Hemoglobin ≥ 8.0 g/dL (transfusion allowed)
* ANC ≥ 500/mm\^3
* Platelet count ≥ 50,000/mm\^3 (transfusion independent \[ i.e., ≥ 1 week since last platelet transfusion\])
* Creatinine ≤ 1.5 times normal for age as follows:
* No greater than 0.8 mg/dL (for patients 5 years of age and under)
* No greater than 1.0 mg/dL (for patients 6-10 years of age)
* No greater than 1.2 mg/dL (for patients 11-15 years of age)
* No greater than 1.5 mg/dL (for patients over 15 years of age)
* Ejection fraction ≥ 55% by echocardiogram or MUGA OR fractional shortening ≥ 27% by echocardiogram
* Bilirubin ≤ 1.5 times normal
* ALT and AST ≤ 3 times normal (for ALT, upper limit of normal is 45 U/L)
* Triglycerides \< 300 mg/dL (fasting or random plasma test)
* Calcium \< 11.6 mg/dL
* Not pregnant or nursing
* Negative pregnancy test
* Fertile patients must use 2 methods of effective contraception during and for 2 months after completion of study treatment
* Normal lung function (i.e., no dyspnea at rest or oxygen requirement)
* Seizure disorder allowed provided seizures are controlled on anticonvulsants that are not contraindicated
* No EKG abnormality severe enough to justify cardiac medications
* No skin toxicity \> grade 1
* No hematuria and/or proteinuria \> +1 on urinalysis
* No known allergy to soy products
* No known severe allergy or sensitivity to wheat gluten
* No known history of intolerance to ketoconazole (group II)
PRIOR CONCURRENT THERAPY:
* Fully recovered from the acute toxic effects of all prior chemotherapy, immunotherapy, or radiotherapy
* Prior CNS irradiation allowed
* Prior complete surgical resection of CNS lesions allowed provided there is no evidence of CNS lesions by MRI or CT scan at study entry
* At least 4 weeks since prior corticosteroid therapy for CNS lesions
* More than 3 weeks since prior myelosuppressive chemotherapy and/or biologics (4 weeks for nitrosoureas)
* More than 2 weeks since prior radiotherapy to the site of biopsied lesion or the only site of measurable disease
* At least 6 weeks since prior large-field radiotherapy (e.g., total body irradiation, craniospinal therapy, or radiotherapy to the whole abdomen, total lung, or more than 50% marrow space)
* At least 3 months since prior autologous stem cell transplantation
* At least 6 weeks since prior therapeutic MIBG
* More than 7 days since prior hematopoietic growth factors
* No prior allogeneic stem cell transplantation
* No prior organ transplantation
* No prior IV fenretinide (4-HPR) emulsion (other retinoids allowed)
* Prior therapy with 3% 4-HPR Lym-X-Sorb™ (LXS) oral powder allowed provided patient is still on drug and it is not available for continued use
* Prior NCI 4-HPR corn oil capsule allowed provided patient did not go off drug for toxicity
* No concurrent antiarrhythmia medications
* No other concurrent anticancer agents, including chemotherapy
* No concurrent immunomodulatory agents, including systemic corticosteroids
* No concurrent supplemental vitamin A, E, or ascorbic acid (vitamin C) except as contained in routine total parenteral nutrition vitamin supplements or in a single daily standard-dose oral multivitamin supplement
* No concurrent drugs suspected of causing pseudotumor cerebri, including tetracycline, nalidixic acid, nitrofurantoin, phenytoin, sulfonamides, lithium, amiodarone, or vitamin A (except as routine multivitamin supplement)
* No concurrent herbal supplements or other alternative therapy medications
* No concurrent medications that may potentially act as modulators of intracellular ceramide levels or ceramide cytotoxicity, sphingolipid transport, or p-glycoprotein (MDR1) or MRP1 drug/lipid transporters, including cyclosporine or analogue, verapamil, tamoxifen or analogue, ketoconazole (except if enrolled in group II), chlorpromazine, mifepristone, indomethacin, or sulfinpyrazone
* No concurrent medications that decrease gastric acid output (e.g., ranitidine) or increase gastric pH (e.g., Tums) (group II)
* No concurrent corticosteroids for emesis control
* Systemic corticosteroids for asthma control allowed if minimized
* Inhaled corticosteroids for asthma control and steroids for routine metabolic deficiency states allowed
* Concurrent palliative radiotherapy allowed only to sites not used to measure response