George/Dead Dad

The way I interpreted it was that the two beings she loved most in her life were George, her dog from her childhood, and her father, who was murdered when she was a child. By the time she's twelve and living in Rome by herself, George is gone...either dead, or left behind in the United States, we don't know, but I assume he's dead. Anyway, because George was her best friend, she imagines him to be her partner in crime. He doesn't actually exist; he's only in her head. She commits all of the murders, but she believes George is doing it. At the end, she's in an institution, and has been forced to come to grips with the fact that George does not exist and she is seemingly on the road to recovery, as evidenced by her sugary sweet letter to her grandmother. When she sees the man from the beginning who killed the thief, however, she has somewhat of a psychotic break and is thrust back into her former way of thinking. She confronts him and George returns to enact their twisted justice. However, she has finally let George go through her treatment at the institution. She knows he does not exist. Therefore, if she is to continue her "justified" killing, she must replace George so someone else is doing the dirty work. She reverts to the only other being she ever loved...her father. He's dead, and his returning at the end is a figment of her imagination, just like George always was. But she doesn't recognize this because she's mentally insane.

I was on the fence about this movie until the ending. I loved it. Very well done and thought out, I thought.

Anyway, that's my interpretation...hope it made sense!