The "Great" Detective

Talk to Ellanoir, Duryllin, and Juddson Rakes near /way 63.81 51.07. Speak to them repeatedly until Juddson has a dialogue.
At 48% go find Herrkrop's body.
Herrkrop's body is at /way 66.23 40.61, Use the Torch of Pyrreth toy to uncover it.
A boat will come in, and Athalton Jones will jump out. Talk to him.
Then speak to everyone else on the beach, including Scrapes who is sitting on a box.
Once you are at 96% go back to Althalton and tell him you know who it is. Tell him it is Scrapes.

Thank you cathline for the name of the boat guy!

If you told me they deliberately designed this quest to compel me to not even try and immediately come here and look for how to finish it, I'd believe you.

This was a bit confusing, I kept restarting as I was getting hardstuck at 36% - this worked for me.

Pick up the quest and talk to Athelton Jones a 2nd time - your progress bar won't move.

Talk to Ellanoir and follow the prompt she gives you.
Talk to Duryllin and follow both his prompts.
Talk to Juddison Rakes and follow him prompt.
Talk to Ellanoir again and follow her new 2nd prompt.

You should now be at 48%.

Go to the beach at /way 65, 59. Make sure your Torch of Pyrreth and Idol of Ohn'ahra are both on when you click this to read where to go next.

Walk down the beach with both toys still in use, you'll be able to investigate sandpiles to see different things - these won't move up your progress bar. The important part is not anything you find within them, but if you can't see them - you have missed a step. It's a good mid way checkpoint to make sure that you're at the right stage for the next step.

Go to /way 66, 40. Through the tunnel to find the body of Herrkrop - you should now be at 60%. You will see Athelton Jones again, you can talk to him but he won't say anything useful or move up your progress bar. Ignore him saying he doubted anyone here saw anything.

Talk to Nat Pagle and follow his prompt.
Talk to Julia Henning and follow her prompt.
Talk to Scrapes and follow his prompts.

You should now be at 96%

Go back to Athelton Jones behind Scrapes and tell him you think it was Scrapes. Scrapes will then go into the boat and run away - congrats you've completed this quest.