Yes, it is after the start of act 3, after the series of Asmodheusエs riddles.
That Little Island with that strange armor is North of the teleporter Island and east of the eastern wall of the temple. You can see itエs coast just a rock of it, enough to throw a Pyramide there.
In the area of the initial Island i have 7 small Islands now:
1. Teleporter Island
2. Island where I get the summoning doll
3. Initial Island
4. Gold Reward Island
5. Imp-Quiz Island
6. ISLAND WITH THE FOOL OF THE DEMON-ARMOR
7. ISLAND, Where Asmodheus teleports me, after I have put on the armor. On that Island I get healed by Asmodheusエ Demon Healer and he asks me, wether I wish to have more life-points. If I answer with yes, I really get more health, but it is drawn from the death knightエs life.
After that Asmodheus teleports us to an Island we have alredy been (I think itエs the Quiz-Island, it is located south of the Gold Reward Island) saying those words of ...lets go and ...meet them
And from there is the only escape with teleporter pyramide