Hi sharpestcookie, thanks for your question. First I'm glad to hear you're enjoying the game, and appreciate the kind words. As for where to find the pickaxe handle, it really only becomes available to you when Smith directs you to go find it, so that's part of why it can be kind of difficult to "find" when you've probably passed by the area where it is at many times. When you are at this point of Smith's request though, look for a new shiny spot in the Main Crossroads area that wasn't shining before that point.
I kind of wanted to evoke a feeling of seeing something that you might consider was useless to you, not really taking much notice of it, until all of a sudden there was a reason to need it and then it became noteworthy, by implementing that sort of limitation there. I'm not sure it worked out for the best overall, looking back on it now, especially considering the majority of the rest of the curiosities in the game can be picked up whenever, regardless of needing them at the time or not, but at least it offers a little variety compared to the rest I suppose.
And yeah that's smart of you to try and ask Jack for wood as that seems to make sense... It's a bit of a stretch honestly, but what I was trying to imply with all that was basically that Malignaunsse had started creating something of a monopoly on the island's resources and was kind of hogging stuff, including lumber supplies and tying up the workloads of Smith and Jack for the most part.
It was kind of difficult to depict a lumber shortage with a big sprawling forest also available but... if you can think of it more along the lines of "we can't spare any right now because it's all going to this guy and his crazy demands for his orders" on the note of lumber and pickaxes, that's more or less what I was hoping would come across, even if it's a little hard to get that sense just from looking at the areas in the game.