First you need to get a full crew. Then save money to get the Phoenix Warbird (1,000,000 doubloons). Then defeat Captain Crawlfish. Go back to Fort Ridley there they will give you a shovel and map. Go to Skullduggery dig it up and win!!
The 6th outlying island is hidden until you collect all 5 map pieces (one from each of the trading islands). It only comes into play after you have driven off Captain Crawfish and have the Treasure...
It is the sixth, small island that is foggy. It is the real "Skullduggery island". It is just southeast (down and right) from the Pirate Outpost, and directly west (left) of Golden Harbor.It will...
There is nothing to be found on the hidden island (Skullduggery) until after you beat Captain Crawfish.After you defeat Captain Crawfish, the governor gives you a treasure location and a bone shovel....
To get the treasure you must first complete the whole island. Go around different islands in the archipelago trading items and earning money. Save enough money for a Phoenix Warbird and a full crew....
Collect the five map pieces (one on each of the trading islands) and join them to see the sixth island, Skullduggery. Once it appears on the map, you can actually go there, but nothing happens there...