In my opinion lol (theory)
Its supposed to resemble whats going on with the of character Jack too..honestly..it basically simplifies everything Jack does both emotionally and physically especially in move 2..his actions are pretty much mirrored to Jacks in movie 1..and 2
the script writers's rule is "never kill the dog" who is the rogue of the story.. so IMO they kinda use the dog for joke purposes with the ride and they also use him to portray Jack IMO..cuz adding something pointless like that you just dont do in the movies..it has to have a bit of meaning behind it..its not a ride its a movie...
He basically shows us whats really going on with Jack cuz he's one of those characters who you rarley see show their emotions..he is a total enigma..it would be really un Jackish to show his emotions(weaknesses) like that so the dog basically shows you flat out what is happening with him.
I cant explain all of it..its too long lol
basically the dog/Jack gives up his old way of life keys/Material possessions and accepts the bone/Love and it makes him a king/hero..but he only does it for one person..cuz he's a pirate..he's only willing to change for one and no one else lol...I think..
at the end once the dog has dropped the keys and bravley protected the ones he loves so they could get away on the ship..we see him sitting on a thrown with the bone in his mouth instead of the keys...which means he has his ultimate prize/Liz/love