From Zelda Legends Wiki
DescriptionHand-Me-Down Tuner after you finish his challenge on Outset Island. All-Purpose Bait is stored in your Bait Bag, which can carry up to eight products.
All-Purpose Bait can be used to lure a Fishman to the surface so he will reward you by filling in a square on your map. They usually give some information about the region as well.
This food can also be used to distract a little Wild Pig so you can catch it more easily, and when placed on one of the grey spots on Outset Island the fat and mature pig will start digging up treasures (including a Piece of Heart) that are hidden within the earth.
Finally, this bait can be used on several Rat's Holes that are for example located in Forsaken Fortress and Dragon Roost Cavern, when you pour some bait around those spots the nearby rats will stop attacking you. Above all a friendly rat comes out of the hole who will sell you stuff like Green Potion, Hyoi Pear or All-Purpose Bait for beefed up prices. Note that not every Rat hole offers a reward, the holes found in the submarines for instance are all empty.
As mentioned above, All-Purpose bait can be used to lure rats out of their homes and open their shops. Strangely enough in some cases they sell you All-Purpose Bait, which makes it sometimes rather pointless to feed them. Moreover why would they be attracted by the food they have themselves?
Description item screen:
This handy bait is great for attracting animals, it's essentially gourmet for pet food. Set it to and use it with (Y), (Z), or (X).
Fishman near Dragon Roost Island (1st Time):
...If you see a fish leaping out of the water when you sail near an island, sail up to it and spread bait out on the water's surface. Trust me, this is good advice, fry...
Parts of this entry submitted by GraniteJJ.