Well, well, K3 Gang - you proved to be a worthy nemesis. In the end I found the dropoff point, even if the payoff was long gone.
Of course, now that I've solved it, it seems pretty straightforward. The problem with these difficult puzzle caches is I spend days inside decrypting ciphers. The whole point of Geocaching is to get me outside!
The first part of the puzzle is simpler than it seems, even when trying to figure out which parts of the narrative are relevant. The second part was perplexing at first, but I was quite amazed when coordinates began to appear in front me. This was quite a creative puzzle. Thanks to The Rat for being patient with me and keeping me going on this puzzle without really telling me how to solve it.
I found the actual cache on my second trip there. I swear I looked in the final location before, but apparently not.
Thanks for the interesting puzzle!