It’s really hard to tell, but this might be a (tiny, tiny) lake (i.e. puddle) on a tiny island in Mud Lake (one of the Twin Lakes) on Bois Blanc island in Lake Huron. There is a possible water hole in Thompson Lake just to the east as well.
It’s not exactly what’s being discussed, but the largest island-in-a-lake-on-an-island-in-a-lake-on-an-islandhas been located on Victoria Island, Canada. It was formerly thought to be an island in a crater lake on the Taal Volcano in Lake Taal in the Philippines.
Parts of Virginia are further north than some of New Jersey.
Next youse guys will be looking for teacups floating in lakes on islands in lakes on islands…
…with a little “island” of algae floating in it…
ETA: Reminds me of https://www.youtube.com/watch?v=0fKBhvDjuy0
My favorite oddity comes from correcting an ABC report that declared that there was trouble “below the equator” in Venezuela, with excessive tire tread separation cases being reported.
Venezuela is completely over the equator.
“We shall lift the equator up and up, until it is just like Kansas City.”
Ooh, I just remembered one: There’s a small pond in Yellowstone called Isa Lake which sits right exactly on the Continental Divide. It’s drained by a trickle of a stream on each end, and so empties into both the Atlantic and Pacific Oceans.
For decades a section of Pennsylvania was south of the Mason-Dixon line.
Of course, there was the problem that Delaware and Maryland disputed that claim.
Delaware won.
I’ll concede you the strong possibility on Mud Lake (nice pickup!) but I don’t see anything that looks like a water hole on that island in Thompson Lake.
I’ve also scoured the islands on Mackaysee Lake on Chambers Island in Green Bay, but can’t make a case for a lake on them either. 
Hmmm, Drummond Island on Lake Huron, has a lake on its north end, called Second Lake. On that lake, there is an island, and that island has two tiny lakes one it, one of which appears to have a tiny (8 foot?) island on it. 46.05025, -83.59670
Which would make that an island on a lake on an island on a lake on an island on a lake.
…
Give this one a try too. It is supposedly the record breaker:
It’s an island on a lake on an island on a lake on an island in the ocean.
Whereas the one on Drummond Island is:
an island on a lake on an island on a lake on an island on a lake on a continent on an ocean.
I like mine better. 
Yeah, zooming in on my phone I think I was just seeing shadows on Thompson.
The reason for this is that when setting boundaries for colonies/territories/states back when it was largely unexplored/surveyed land, it was common to set the dividing point as “the highlands” of a particular area. It was thought that this would be fairly easy to determine, based on the direction rivers flowed.
For example, the boundary set between Maine and Canada: “along the said highlands which divide those rivers that empty themselves into the St. Lawrence, and those which fall into the Atlantic ocean”. (It turned out to be rather harder to define this specifically than was expected. Most of the later territory/state borders were defined on a strictly geographical basis, on specific ltitude/longitude lines. Thus the square/rectangular outlines of many of them.
So it isn’t at all unlikely for the ‘highest point’ in many states to be along the border.
The northern border of Delaware is an arc drawn from 12 miles from the city of New Castle. But there is a tiny section between that arc and the border with Maryland that was not included in the arc, which is claimed by Delaware. It is called The Wedge.
See post#69. Interesting place, the Wedge.
Thanks, t-bonham. It seems I put the cart before the horse; borders weren’t established to claim mountains, mountains determined the borders.
No juicy Hatfield/McCoy-type stories where someone tries to claim Clingmans Dome? I’m crushed!
There are parts of Victoria where you can go east into South Australia. And west from South Australia into Victoria.