The Emerald Sword is Hatty Hattington's starter weapon that is in the Can't Stop Crying Pack. The sword and DLC is acquired when someone owning both the full version of Castle Crashers and Behemoth's Battleblock Theater (PC Version) obtains one achievement in Battleblock Theater (Xbox 360 Version) or from buying the DLC (PS3 Version).
The weapon is reported to be very glitchy, if a different weapon is equipped then the sword disappears from the weapons frog, and cannot be found again. Resetting the character's data seems to make the sword reappear, but this seems to be patched in the PC version of the game.
In order for the sword to be selectable in the weapons frog, the player must swap out a weapon (the Pitchfork, for example). This will result in the Emerald Sword being dropped. The player must pick it back up to make it selectable in the weapons frog. Once it is in the weapons frog, it can be selected to use for any character.