Yeah, I got lucky and found him in ~40 minutes. The achievement didn't unlock though.
There is a fix that works retroactively (it works, so I hope it's not a clever bit of malware). The game records your achievements, but fails to upload them to Steam because of bad coding.
What you're looking for is a "devil room", though how you're supposed to know it's called that, I have no idea. After you defeat a boss, there is a chance that a door will open up in addition to the hole in the floor leading to the next level. Inside the door will be an optional boss, and there is a chance that boss will be the Krampus (who is no pushover.)
I don't like that game. I really don't. It's ugly and intentionally cryptic. It's "storytelling" is ham-fisted and juvenile. I've heard people praising the soundtrack... but both Bastion and Trine 2 blow this game out of the water when it comes to music. Lots of soundtracks are better than this.
EDIT: Oh, and the gamepad "support" in the options is just some text telling you to use Joy2Key. Seriously? That is some major bullshit right there. Being "indie" is not an excuse for laziness.