Okay, it was late when I posted: here's a little more in depth analysis.
THIS CONTAINS SOME SPOILERS! DON'T READ IT IF YOU PLAN TO SEE THE MOVIE AND DON'T WANT THE SURPISES RUINED!
I think this movie was imaginative, and it had some virtues, but overall I didn't really love it.
For the things I liked: the cast was superb, and the acting was absolutely topnotch. I particularly liked Naomi Watts performance. Her portrayal of the somewhat-arrogant, cynical & hard bitten reporter changes slowly & skillfully as the supposed urban legend became chillingly real. The movie did create suspense, and it was genuinely creepy.
The look of the DVD is excellent, with a beautiful and natural color palette, though purposefully muted. The cinematagraphy was first rate, too. I loved the overall look of the film.
However, the movie has some flaws, at least to me. Firstly, you can tell the kid is a sorta creepy, spooky, "I see dead people" type of "kid with the second sight" kind of kid, a la "The Sixth Sense" or "Stir of Echoes". But there's no explanation why. We largely know he will be due to the fact that the director & writer cast a creepy looking kid and make sure he's written to be really odd. But c'mon! The "kid with strange visions" deal is getting old. I bought into it in TSS & SoE, but now I want an explanation! Why did he draw his cousing dead a week before she died? And how was he communicating with the girl?
Next, what the hell was the girl? The implication is that she was concieved under a bad sign, so to speak. Was it magic? Bad medicine? Is she a demon? The devil? We don't know, and the movie never tells us. Maybe they were going for a sense of mystery, but I just found it bewildering.
And what did she/it want? Apparently just to be evil. There isn't much motivation besides this. I suppose maybe they were trying to be unconventional and creative, but some conventions are needed for the movie to make sense.
Lastly, the I didn't like the ending. Not just because there's no resolution, though. That's another one you could view either way. Sure, it's kind of a Hollywood cliche that the good guys win and the bad guys lose, but the teen-slasher-type of ending where the bad guy always sticks his hand up thru his grave after he's buried or jumps out of a closed before the credits roll is a worse cliche yet. And the "solution" the heroin finds to save her son is intriguing in a sense; she finds a way to pass the buck, essentially assuring that others will die instead of him. A bit disappointing, but again, in reality, what would one of us NOT do to save our child?
All in all, an intriguing movie, but one that fell a bit short of the hype it generated.