Horseshoe bay is a channel between Rinca and Kode Islands. Looking at the map, you can see that it's actually an ancient caldera where the water has cut through the walls in two places. The bay is home to several excellent dive sites, some of which are among the most famous in the Komodo area.
The bay can also be a great place to see more of the dragons and other Komodo wildlife. Some of the dive boats have left food on the beach, so now wild boars and dragons have taken to hanging around the beach whenever a boat comes near in the hopes of a handout. On our visit, there was a family of pigs on the beach when our RIB approached. A dragon came out onto the beach when we got close, but the male boar chased it off! Fortunately, our guide had the boat move down the shore away from the pigs, and the dragon eventually came out to greet us again. It 'posed' for us while we stayed safely offshore.