The scenario: I resume my quest (playing it) from a save point right before acquiring the Dungeon's item. I grab the item (lv 2 Boomerang) and die shortly after. I accidentally hit "retry", so I went back to the quest and resumed from the save point already mentioned. I throw the boomerang (Lv 1) and find that the sparkles of the Magic Boomerang appear. I throw it around and it turns out i throw the Lv2/Magic boomerang, but the subscreen sprites are that of the Wooden/Lv1 Boomerang.
Die -> Retry Item bug (403)
Fixed in the next build.