For the first part of the quest, finding the Nacho Box should take 3 Machetes.
It will take 6 hours to collect the Nacho Box, after which it will be in your Inventory.
To complete the third part of the quest, click on the Tournament Grounds to attach the Nacho Box. Hammering it will take 6 hours, and remove the Nacho Box from your Inventory.
"Oh this is perfect. I'm sure the King will love it."