A Castle Full of Cats

you'll find it in a chest on the right hand side of the secret room in the library

The crystal ball upgrade is in 'The Safe room' (the secret door in the Library). In the safe room is a chest where it's located. In order to open it you need a pair of eyes which are located in 'The Bedroom'. Precise location is to the far left, next to the bed in a water cup. Once you get the eyes, you can then open the chest.