Is located either on the left or right side of the pier. I can't remember which side but it's next to the first "post" that supports the pier. The treasure itself is just money that you're supposed to give to his wife but, obviously, you can just pocket for yourself if you like. The treasure clues....SPOILER....
are found in quests, as enemy drops, and I think in a treasure chest or two. I don't remember much at this time about them except that you get one from the trader rescue, hostage rescue, and assassin attacks. The assassins are located at Prison Path, Windmill Hill, Knothole Glade, Witchwood Focus Chamber, and Hook Coast. Take note (I'm playing the TLC version) that when going after the assassins, you must kill them all in one go. In other words, you can't kill just one, go on a quest, then come back and kill another. In TLC, there seems to be a glitch where the game resets them if you don't kill them all while you're not on a quest. Er, it's not a major bug...you'll just have to keep on killing them until you manage to get around to doing it for good.
The treasure itself (the mighty frying pan) is simply a basic frying pan (I think it does something like 100 damage or so) and it's only valuable in any manner AFTER you find all six treasure clues. Digging it up before you find all the clues will cause it to lose all five augmentation slots. That's right, there's five slots...you'll only visually see four but the trick is to give it all five augmentations at once as the fifth slot is hidden. Basically, don't even dig it up until you have the five augmentations that you want and then put them all in, one after the other.
The location of the pan, if you don't want to look for it via the clues, is between the two closest haystacks and the barn at Orchard Farm. I do mean the CLOSEST two haystacks...the ones that are so close to where you only have "just enough" room to walk between the two. You won't see the dig icon, though. You just have to manually use your shovel and you'll dig it up.