Intelligent plot line SPOILER ALERT!
I just watched this movie on Netflix, and I found it to be quite good. It's not your typical ghost story, it's one that requires you to listen to the subtle hints that are given in conversations between Judy, Anna and Helenka. The scary children are war orphans, jewish children that were part of the Nazi's infamous medical experiements that came to the St. Ange in 1946. The children were so horribly disfigured and disabled that they were separated and kept in a different area of St. Ange, away from the other children that were there. St. Ange was understaffed, many of the children were not able to be cared for sufficiently, and one by one they died...or, you can take the stance that they children were euthanised...although this is only speculation- I did not sense that they were murdered-just neglected and allowed to die. During the WW II, The Nazi's were attempting to try and change the Jewish appearance of the children to one more Aryan, to be more akin to Hitler's ideal "master race" of tall, blonde blue eyed people-thus the experiments to alter height, eye color, skin color, hair color, which caused the children to have deformed bones, pale veiny skin, baldness, facial deformities, eye deformities and blindness.
The woman Judy, was actually a war orphan that arrived with the other refugee children, and I think that the film hints that she played with the children and was very attached to them in life, as well as in death (Judy states that the children come to her at night) If the disfigured children were euthanized, this would explain Judy's mental state and why Helenka keeps her medicated so that she will not remember what happened to them.
The ending was the weakest part of the film. I can understand Anna's death, and the concept that she becomes "mother" to all the dead orphans but I cannot understand why she would look disfigured like the children. It would have been more believable and easier to interpret if she did not look disfigured-she was not disfigured in life, why would she be so in death.