It is not underground.
The puzzle is situated near the town dock.
If so, then notice where the south face of the obelisk is pointing.
Depart from the town dock in the boat, heading around the castle on the southwest corner of the island.
As you approach the castle, you will see two green trees. As you round the second green tree, you will see a start circle where the castle wall meets the rock. Activate the start circle and then trace the path along the castle's dark brown molding / trim (whatever that brown line around the castle is called).
The path will continue as you ride around the castle.
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Complete spoiler:
This one is solved while moving.
Specifically, it is solved while riding the boat.
Have you noticed that you can sometimes narrow down where an environmental puzzle is, based on its symbols location on the obelisk?
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Roll over each black area below for hints.
Each new hint gives away more than the previous one.
It involves the castle on the southwest corner of the island.
As you depart from the town dock and head around the castle, look carefully for a start circle.
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It begins near a dark green tree.
Map
Town Obelisk
South #1
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>
Intro
This one is fun! (And not just 100% visual.)
It is not situated in the town.
This is roughly where you can find it:
Hints:
You need the boat to be moving to draw the complete line.
THE WITNESS - ENVIRONMENTAL PUZZLE HINT GUIDE