I THINK I GOT IT...SPOILER SPOILER
I was really confused at the end of this movie. After thinking about it...I believe Alex is describing his own faults and misdeeds to the physchiatrist and just putting Nigel's name in place of his own. The only REAL evidence we have in this movie that Nigel is a bit "off" is 1. His taxidermy setup in his dorm room and 2. the secret room in the basement and his penchant for Knights history. These two things may be weird, but do not make Nigel a killer. Any thing else we are ecouraged to believe about Nigel comes from Alex while speaking to the forensic psychiatrist. There is no further EVIDENCE of Nigels actions. The physchiatrist begins to look into the Gestaat theory based on what ALex has told her. We believe it is Nigel, based on ALEX's accounts. Nigels parents are killed. We do not find Nigels dead parents until after Nigel is dead. We also find out that Alex's mother is dead, and he has been raised "impeccably". Furthermore Alex's description of Nigel to the physchiatrist makes us believe Nigel is evil and manipulative. I believe it was Alex the whole time. Nigel was the new guy. Alex learns Nigel is intelligent, and has some fantasies of his own. He also fears and is intrigued by Nigels "odd side" This fuels and adds to Alex's own pshychotic, genius mind. His genius is alluded to throughout the movie as he constantly debates his professors, and the Headmaster makes remarks regarding his mental capabilities. Alex mentions the painting in the school that his father looked at so often, and goes on to say that one day it dawned on him as to the actual meaning of the painting. Alex claims he was framed by Nigel himself for Nigel's death. By spinning everything around, and putting Nigel in HIS shoes while explaining the turns of events sets during the movie, this sets the stage for Alex to claim Nigel's death was a suicide. Alex killed the girl, killed Nigels parents, and went on with his physchotic adventure by stealing the girls head from the grave. After giving a stupendous seminar on the Gestaat theory, the psychiatrist is then led to the grave where the girls head is missing. She realizes this at this point it has been Alex all the time, calling him evil. She knows at this point he pulled the wool over her eyes.