From Main Gate Cross Site of Grace Go south towards the cliff side path which'll take you to Prospect Town.
it's visible in the picture. Those buildings on the mountains south of the site of grace
once you're in Prospect Town explore until you arrive in the middle of town with a bunch of bloodfiend enemies.
take em out and you'll get the bloodhfiend arm it's right where these guys are gathered
Take the cliffside road from the castle site of grace and go to Prospect Town. You'll find it right when you reach the center of town with a bunch of enemies sitting around
Yo i was looking for the same weapon and found this video, I hope this is helpful, There is also a build video from this youtube channel I recommend watching that too