Sure, it's creepy, but it's not that bad. You've lived through worse, right? The old shaman used to camp here, and you can make good use of the site as well -- it's also one of the quietest places on Felicity Island.
In the Shipwrecked and Single story, this is where the protagonist first meets the shaman of the village, Amanaki Tama. He wants the protagonist to bring the idol, before telling him/her how to pass the jaguar, Mata, to reach The Forbidden Village. The nepeta plant that is needed to tame and pass Mata can be found on this lot.