As you go down the stairs, jump and collect the items, then proceed down and beat up the two pirates. Jump over the gap and keep going. Beat up more of the baddies and break the boxes. Keep going and collect the coins on the cliff wall.

It's all a downward path to the left, so you can't get lost. At the bottom will be more guys and you will see gold coins forming an arrow. Collect them, break the box and activate the lever. Now you're playing as Puss in Boots. Go along the catwalk and beat up the pirates. Hit the lever at the end. Now, back to Shrek. Go in, beat up the pirate, destroy Hook's statue and collect the mug.

Break all the crates and open the gold chest by tapping the Light Attack button repeatedly. Keep going onwards breaking crates and beating up pirates. Break the piano for another mug. You will see another gold coin arrow, so collect them and break open the box next to the gate to free the prisoners. Then break the gate by tapping the Light Attack button. Go on through. Jump down the cliff, and beat up the pirates. Break the box at the far right for another mug.

Continue left and jump over the gap where the gold coins are. Beat up more pirates and keep going. Jump over the gaps onto the ledges, where a mug is,
until you hit solid ground again, and then just keep going. You'll come to a scene where you see Captain Hook. Run after him while beating up more pirates.