It's also been a long time since I played (much too long...), but I think at that point in the game you were ambushed by the pirate ship while on the way to Mount Pyre? You may have to go there first to trigger a dialogue about the extreme heat, to make Water Dragon Isle available. But the Isle is optional at that point, you can continue on up the mountain as long as you have lots of Tablets to recover the extra damage you'll be taking.