Items

[Nitr3x]

Feel free to leave hints for where to find all the progression locking items and upgrades. It would be nice to have one place for anybody to check them all.

Strength costs 50coins from gym in town. Breaks small cracked rocks
Later game stuff Upgrade is in the NE corner of the city, requires balloon.

Hookshot/grapple is in the far west room of the ruined dungeon. Hits orbs and pull yourself to trees and logs across water and chasms.
Upgrade fro 300coins from shop at blacksmith in the mountains. Longer chain.

Lantern is in the dark forest, east of where you enter the forest there's a ghost merchant. Larger vision radius and you can now burn sticks and sleeping stumps.
Upgrade is in the mansion behind the six ghost wall (courtesy of @squibs) Even larger vision radius and you can now burn hidden bushes.

Boots cost 299coins from superstore in town. Let's you run
Upgrade is in the snow/ice dungeon behind the cyclops down the right path.Stops you from sliding on ice.

Snorkel requires hookshot. Bought from snow shop by double waterfall for 150coins. Swim in water and dive for a short period.
Big SpoilerUpgrade is the seventh (7) item from the dragon.

Magnifying glass is down the ladder on the large island northeast of the town. Go right first. Lets you see secrets close to you.
Upgrade is further in. Increases vision range.

Claws are found in the snow/ice dungeon north east area behind a key door. Allow you to dig and tunnel underground.
Upgrade is at the end of the cave labyrinth that you can only access after obtaining the balloon. It's the cave entrance just east of the stairs that lead into the zombie city. Lets you stay underground longer.

Magnet is the third item from the dragon. Increases pick up range.

Upgraded coin sack is the fifth (5) item from the dragon.

Clover is the sixth (6) item from the dragon. Increases coin drops.
Upgrade is the eighth item from the dragon. More coins.

Boomerang in power plant dungeon in middle east room. Breaks pots and grass, can flip levers.
Upgrade is in the WNW room. Adds bullet time so you can curve the boomerang.

Are you sure?Broken sword is found up the waterfalls on the far west side of the map.

Balloon is in the northwest corner of the city. Lets you glide over water or chasms to platforms of the same height.
Upgrade is in the bottom floor of the forge, southern most room, west chest. Getting there is the puzzle. Lets you fly twice as fast for twice as long.

Armour is obtained at the end of the colosseum. You take less damage.
Upgrade is from defeating the Forge boss. Less damage, minimum of half a mask.

[squibs]

A correction:
The Lantern Upgrade is in the Ghost Dungeon behind the Ghost Door requiring 6 Ghosts on Floor 2.

[vøid]

I just want record 33 T-T

[DrRobot]

Balloon upgrade is on the bottom floor of what?. It’s the only item I haven’t found. Is it in the city sewers?

[Nitr3x]

Originally posted by DrRobot:

Balloon upgrade is on the bottom floor of what?. It’s the only item I haven’t found. Is it in the city sewers?

Should have been more clear, sorry.
It's on the bottom floor of the forge dungeon. Access to the dungeon is in the middle of the city after getting the three cog pieces. Check the end game discussion for where to find those if you don't have them. The dungeon itself is quite the maze and you have to back track a lot so I don't have a guide for how to get it. I got stuck a few times trying to get it.

[Marn]

The upgraded Snorkel lets you climb waterfalls

[Tritoch]

Bumping this because I found this very useful