To install this you'll need Mod Organizer 2 (v2.3.2+) or higher and its Basic Game plugin (already included in Mod Organizer 2.4+), and follow these instruction :
Create a new instance
If Black & White 2 or BOTG don't show click on the "Show all supported game" checkbox and select the game...
If you're on windows try not to unpack the .rar and using windows built in iso mounting utility, if you did not already try it. If it doesn't work i'm afraid i don't see what it could be.
If you try to make a new game does it still crash on the third island (Also by the third island do you mean the Island before the one where you fight the norse chief or the second japanese island ?)