I think the new version looks much cleaner and clearer!

OK, this is going to be total pedantry, but ... when I read it quickly I read "Lord Morgans Island0". I know those island names can be a bit hard to place, but the shape of the island just bleeds into the name in this case. Also, I would try making Mudmoon bay a flat label (not angled) to stand out against "The Coal Coast" a bit more ... or at least not intersect the land border. I think you have enough room to keep the entire label in the sea there.