So you're talking about a little pocket universe with a closed space-time curvature?

Your balloon example sounds a little bit like a black hole (not sure if those are considered to be closed) the event horizon, or the surface of the balloon, prevents light from leaving so no one outside can see the island or things in its immediate vicinity, but everything in the outside world is still visible to the island cause there is nothing stopping that light from crossing the event horizon. The only thing is the negative density cause by the exotic matter wouldn't just create a barrier around the island, the entire volumn of the balloon would have the same negative density that causes light to be trapped by its edge.

How much do we know about the rocket experiment that Faraday did? If we knew that path of the rocket Im sure we could make more sense of this. Did it fire straight off the boat to his homing beacon (ie, in an arc-like path) or did it first take the bearing 325?