The island in south-eastern part of the world map is controlled by ghosts. The only true challenge you find there is an enhanced version of a flesh-eating tree you encountered in Devour Village.
Boss - Ghost Yeet
It's not an easy opponent. It has over 10000 HP and deals considerable amounts of damage, as well as negative status effects. The key to victory is fire magic, which doesn't do much at the beginning, but as soon as the tree catches fire you practically can't loose. Just hit him with as many Flaruses as you can.
In a chest that was guarded by the boss you'll find Heatsink Parts - one of the mechat upgrades. Also, look around for another chest with 30xMedals.