This secret achievement is called "You Found Me!" and is unlocked by fighting against Classic Jade in the Arcade Ladder. Below, I'll tell you the requirements needed to fight Classic Jade, and some strategies which can be used to make it easier to unlock this achievement.
First, you'll want to have the right settings in place. Go to options, and change Number of Rounds to 2. You can choose whatever Time Limit and Difficulty you like. I recommend Beginner difficulty for obvious reasons.
To get to the Classic Jade fight, you have to get through the Arcade ladder, all the way past the Shang Tsung fight, while meeting a number of stipulations. These are:
* You must have the Number of Rounds set to 2.
* You must attain 5 Flawless Victories, including a Double Flawless Victory against Shang Tsung.
* You must perform 3 Fatalities, including a Fatality on Shang Tsung. Stage Fatalities can be used, but Babalities will not count.
* You cannot lose a match. You may lose rounds, however.
Note: IV TRELON VI says: I don't think you need 5 flawless victories. Just a flawless on Shang. ~ Thanks, IV TRELON VI.
This may seem daunting at first, but there is light at the end of the tunnel. If Shang Tsung gets a hit on you while you're going for the Double Flawless (and trust me, he will, many times), then fear not, because you can win both rounds, getting to the "Finish Him" screen. Pause when you see "Finish Him", and go to character select. Choose your character and try again, the game will keep your record thus far intact.
When you get through all this correctly, right after the Shang Tsung fight there will be a loading screen for Goro's Lair. You will fight against Classic Jade. You don't have to beat her, only let the fight run until the achievement pops. This takes about 5 seconds.
Interesting side note: Classic Jade seems to have a constant invulnerability to projectiles, similar to the move Jade uses where she flashes green, any projectiles go through Classic Jade, buffed or not.
Okay, next, onto strategies. There have been a few methods described in other guides, both here and on other sites. I'll run through those first, giving positives and negatives of each strategy, just so all the information you need is in one place. My strategy may not fit your fighting style, one of these may work better for you:
Sheeva
(Up Down attack, followed by uppercut or sweep, uppercut)
This is the strategy I thought would work for me. Sheeva, although slow, hits very hard, and her up, down attack is hard to dodge. I regard Sheeva to be the character I play best with, I'd rate myself 4/10 as a player, but with Sheeva I got the 10 Online Ranked Wins achievement legit. I tried for nearly 2 hours to get this using Sheeva, to no avail. She always gets caught out while in the air. Shang Tsung shoots fire up, which always catches you off-screen. It has also been mentioned that you can use the up, down attack, followed by a grab, which leaves Shang Tsung stuck on the floor, making this easy. While it's true this happens, I would estimate that it works around once every 10-12 throws. This is not ideal as Shang Tsung can sneak a hit in while you're messing around trying to get him on the floor. Moving on...
Scorpion
(Down, Back, A attack followed by uppercut, or jump punch then uppercut combo)
Scorpion is quite fast, and hits hard. The down, back, A attack where Scorpion goes off screen and hits from the other side fails dramatically. Shang Tsung will block this 90% of the time, and get a hit on you 50% of the time. The jump punch, then uppercut combo was more effective, I got a few Flawless Victories in the half an hour or so that I tried this, but couldn't get a Double Flawless.
Okay, I'm suprised this hasn't been posted yet, but my strategy may help out some people still struggling with this. Firstly, choose Sheeva, and up, down, uppercut your way through the first seven kombatants, picking up Flawless Victories and Fatalities along the way. Then, beat Shang Tsung down and get to the "Finish Him" screen, and change character to...
Stryker
(Back, Forward, X)
Stryker's gun is a brilliant way to beat this. Make sure you start the fight crouched, and uppercut Shang Tsung to get him away from you. This may take a few tries. Then proceed to fire away over and over, make sure you're quick inbetween fires, so he can't sneak a fireball at you. With some patience and speed, you should be able to beat him. With Stryker I needed less than 10 tries, after all the frustration of trying with others.
Something else worth mentioning, depending on the fighter you choose, Shang Tsung seems to transform into characters designed to capitalise on your moments of weakness. If you choose Sheeva for example, he transforms into either Quan Chi, who teleports on top of you, or Baraka, who has a spinning attack which counters the up, down move. With Stryker, he transforms into Jade a lot, who can become invulnerable to the gun. If this happens, put it down to bad luck and try again.
Thanks to anyone who has managed to read this far without getting too bored, I hope this hasn't been too long winded, I just wanted to cover all the bases. If there is anything I've missed, or could add to make this a better solution, please feel free to comment or suggest, I'll add it in and give you credit. I don't just accept constructive critisism, I welcome it.
Good luck, fellow kombatants.