I also got stuck at the pickax thing (I didn't even realize it was a pickax, I though I was trying to assemble a bow x) ). After trying many things, the string got stuck in furniture and the two other item got stuck together :(
It's too bad because the ambient track and the overall look of the game had started to really make me feel the spooky vibe. The step sound fx could have been better too, and add to this spooky mix.