From ground zero, you can see The Spooky Place—the old Koehler warehouse that used to double as the local Jaycees' haunted castle at Halloween. If you hear eerie howls here, it may mean that you've been spotted by hungry were-muggles! (Or maybe it's just someone's dog. Maybe.) You may encounter muggles hiking on the trail as well as fishing in the river, so stealth will be necessary at times.
Yes, the cache is placed on an island, but unless the water is unusually high, getting over to it shouldn't be much of a problem. That's not the reason for the terrain rating. That, I fear, is for what you must do to access the log once you get there. Please be careful with the container, and don't let it slip away from you.
Congrats to Krazi Tribe, FTF!