I figured that her dad orchestrated the whole thing. Maybe he asked someone to "make" those hoof prints, and lure Prancer in the opposite direction, just to give the appearance that he disappeared. The way he says, "Maybe he flew," sounded too nonchalant to me.
LOL I don't know. The reason why I have trouble believing that Santa is meant to exist in this movie is because it is so heavily rooted in reality. Most of those other Santa movies are very firmly committed to the fantasy. Prancer was more about family, hope, and faith. Jessie needed something to make her feel like "everything would be okay." So I think Santa at the end was a product of her imagination.
But...on the other hand! She did tell Carol that her mother would "never lie" about the existence of Santa, and Prancer did appear just after his wooden counterpart fell down. We don't see her dad's face after Santa's appearance, so we can't know what he did or didn't see. The answers are definitely kept ambiguous on purpose. It's actually very clever, because it keeps children happy, and gives adults some opportunities for logical explanations.
I personally believe that the ending is conveying this message: If you believe in Santa, he's real. If you don't believe, then he's not real. It's all about faith. Either you're a Virginia, or you're not.
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