WHAT THE HELL JUST HAPPENED?

I guess the best way to describe this movie is that it's a story where all the three major characters are insane. Angelique suffers from a personality disorder, the doctor, who is probably angelique's father and her lover (and possibly the father of her child as well, the boy Peter that Angelique meets in the playground), demonstrates a certain lack of morality and judgment, while the reporter, Grace, has demons of her own. The flashbacks and other hints about her past suggest some psychiatric issues with her, probably related to sexual abuse as a child.

In the light of this, I think the ending should be read as follows. The doctor wishes to kill Grace but also to cure Angelique thereby dying her hair, and attempting to make Angelique 'kill' that part of her, also thus removing from himself the negative emotions that Angelique harbours towards him for having killed Annabelle. Angelique, who has obviously not come to terms with the death of her sister, sees Grace in that role, especially as Grace and her seem to share an empathic bond between them. Grace, on the other hand, is shown as being on the verge of a nervous breakdown, and the drugs and treatment meted out to her at the clinic push her over the edge, transforming her, in her own mind, into Annabelle. Both their emotional needs are fulfilled through this delusion.

Hope my take on this movie helps. Personally, I though this was a pretty decent horror flick, where the characters rather than the scares demand attention. My opinion, and it seems, hopelessly in the minority.