The ship is in one world and the island is in the other. There are two zoom lists and the one that has Aridea is the world with the island. I didn't give any other locations because I wasn't sure how much farther you were in that world. When you are in the world with the ship, to get to the world with the island you will need to use the switch world option which will put you at the Alltrades location in the world with the island. I don't remember exactly where the island will be when you zoom to Alltrades, but it should be nearby. The island follows you, just like the ship and the bed will, when you use zoom. I suggested Aridea also because you only need to take a few steps away from the location to see the island and in some locations it is a little more difficult to spot when it is right next to green areas of the map.

Cast the hero's spell called "Zoom" to any location in the dream world and the floating island should follow you as well