When you reach the part of the pier by the ship, you turn left to get on board; if you turn right, you can find an unattended dinghy tied to the pier. It's yours to use, but not until you need to go to a place that requires a boat ride.
Now all you need to do is fix the dinghy's outboard motor, which is currently nonfunctional. To do that, you need a pamphlet called "Dinged Dinghies" from Soren (which he'll give you after you talk to Alex the first time) and the book called "Iceland at a Glance" (called "Guidebook" in inventory) from the gift shop.
Now you have the tools you need to replace the spark plugs and get the dinghy working. The goal here is to place the plugs and cables in the correct spots to match the numbers shown in the pamphlet. Read to the end of this hint for a picture showing how to do this.
Hint 6
This task is all math -- well, arithmetic, actually, but it's in Icelandic, which adds to the difficulty of the task. The first thing you might want to do is use the book to translate the numbers here.
Hint 7
Now you know which cable goes where. The sextan cable is 16, and it goes on the top -- but it can't go there until you place two plugs in that top slot, a red one on the left and a white one on the right.
Hint 8
The thing is, those two plugs have to add up to the same number on the plug. So you have to use a red plug and a white plug that add up to 16 in that top slot. What numbers do you have to work with?
Hint 9
As it happens, this top cable is pretty easy. There's only one red/white combination that adds up to 16.
Hint 10
In fact, this is close to being a goof-proof puzzle, as long as you can translate the numbers and do some elementary arithmetic.
Hint 11
Getting frustrated? Okay, here's the arrangement you want: