The shovel is for the grave in the forest level. It is NOT useless, it lets you access what is quite possibly the only appearence of a certain character in this game.
When I say that the shovel is useless, I mean up there. If you go up, you will see that just like Crow's grave, there is a lump of earth that makes you think you can dig it, but no, you can't. I'm sorry if there was a misunderstanding.
