1. History of the town -
30 years before the time in the film, Silent Hill (a mining town) was a normal town like any other, but it was hiding a dark secret. The town was originally founded by religious fanatics (occultists) who believed anyone un-pure to be the work of a demon and they must be destroyed along with anyone aiding the demon (witches). They believed burning demons and witches would keep the town pure and protect it from the apocalypse. The fanatics were now only a small part of the towns inhabitants, but they still followed their old ways. Dahlia, a member of this occult, had a child and nobody knew who the father was. After years of trying to get Dahlia to release the name of the father (if their ever was one, but they never elaborate on this point) the group finally labels Alessa as a witch, and eventually a demon since she had no father. So the occult does what they always do, they attempt to burn her alive. However Dahlia intervenes and gets help from the normal citizens of Silent Hill who come to rescue Alessa. Before they can rescue her though the burning begins and in the process Alessas bindings partially break and the coal fire under her gets knocked over starting a fire that will eventually consume much of the town and spread to underground coal veins. This in turn will force the eventual evacuation of the town since the underground coal fire will continue to burn for as long as coal is present and the fumes are dangerous.
2. Alessa/Sharon and the occultists
Its safe to say anyone who saw the movie realizes that the fire Alessa was burned over never actually killed her; instead she lived with horrible burns over her entire body, kept alive in the hospital with constant care. We can only assume that during this time the town has not yet been evacuated (they are probably attempting to extinguish the underground fire at this point). At any rate, after years of ridicule and hate in her direction, this last attack on Alessa put her over the edge and her severe pain and anguish taints her good heart. While Alessa is in the hospital she starts gaining an immense hatred for all the occult members except her mother since her mother was always good to her and didnt take part in the burning. This hatred attracts a demon, the very thing the occult fears the most, and Alessa strikes a deal with the demon. Now this is part that is open for interpretation and you will see why I believe what I do after I explain the ending of the movie
the deal although never stated I think is that the demon will keep her alive and help Alessa get revenge on all the people who did wrong to her and throw them into her worst nightmares, and in return the demon gets Alessas soul (and possibly those of all the occultists she kills). When Alessa strikes this deal all the people she wants revenge on are shifted over into an alternate reality of the town itself. They are in a sense still in Silent Hill, however they are in a misty deserted version of the town which I believe symbolizes purgatory
their souls are awaiting judgment by Alessa. There is one thing however the demon didnt count on, the faith of the occultists. It has been said that when a religion is formed, everything the religion believes in becomes inherently true (Catholics believe they go straight to hell if the commit suicide for example), and the occultists believe that the Church of their faith is a safe haven to which the demon cannot enter. Since they have strong faith in this it becomes true, meaning the demon can only help Alessa get the revenge she promised her when the occultists are outside the church (when she turns the town into dark Silent Hill with monsters). Many years later (at this point the real Silent Hill has been abandoned) when it becomes apparent that the occultists are too smart to get caught in the dark Silent Hill a new plan is formulated; the Demon takes all the goodness and kindness left in Alessa and puts that into the body of a baby (Sharon) which is then left at the orphanage one town over. The idea is that when this child grows up the Demon can call to her and get her to come back to Silent Hill but with her parents. See the Demon needs someone strong and determined to use as a vessel to get into the church in order to cast judgment on the remaining occult members, and who is more determined than a mother trying to rescue her daughter?
3. Rose, Silent Hill, and the Demon
The Demons plan now starts to take affect. She starts calling out to the now older Sharon (the reincarnated version of Alessas goodness) and drawing her toward Silent Hill. Rose, a loving mother to Sharon, decides to take Sharon to Silent Hill after months of doctors and medicine not helping with sleepwalking, night terrors, and calling out the town name in her nightmares. Once Rose gets to the now deserted Silent Hill the Demon immediately opens the doors to the purgatory version of the town sucking in anyone unfortunate enough to be nearby at the time (Cybill Bennett). While Rose is unconscious the Demon calls out to Sharon and puts her somewhere she knows she will be safe
with Dahlia who will see Sharon almost as if she were Alessa and hide her from the occultists (Dahlia I dont believe knows this is the Demons plan however). This does two things for the Demon and Alessa
it keeps Sharon Alive and safe (since the occultists believe burning a demon or witch destroys them, then burning Sharon would destroy the Demon and Alessa), and it ensures Rose (the future vessel for the Demon) will continue to search for her daughter and not just give up like she would it Sharon was dead. The Demon now starts the next part of their plan
get Rose to feel pity and sorry for what happened to Alessa in order to persuade her to make a deal with the Demon later on. So the Demon leaves clues for Rose to follow, bringing her to all the places Alessa was hurt and ridiculed (being called a witch in the classroom, getting raped in the bathroom, being burned in the hotel). However during the course of these events the purgatory Silent Hill goes through several transformations into Dark Silent Hill, and I believe there are 2 reasons for this. The first one is obvious
.the occult members leave the Church periodically to search for supplies in the town and the Demon tries to take advantage of this by turning the town to the dark version hoping the monsters can kill any stragglers who dont make it back to the church in time, but also I believe it serves as a test to Rose to make sure she is a strong enough person, with a strong conviction, so the Demon can use her will to save Sharon to get into the church.
4. The rest of the story
Now you know all the background needed to understand the rest of the story. The Demon gets Rose to pass all her tests so far, Sharon is still hidden, and Rose makes it to the Church where she meets Christabella. Christabella tells Rose where to find the Demon not knowing she is Sharons mother yet, however she finds out right before Rose escapes down the elevator by looking at the locket. Now Christabella knows who Sharon is and that they must burn her before Rose gets to the Demon. Christabella also gets a hunch that Dahlia has the child since Sharon is so like Alessa and Dahlia has so much love for Alessa (I also believe the Demon was the one who clues Christabella in, explained a few sentences down). Skip ahead and the occult members get Sharon and start preparing to purify her. During this time however Rose makes it to the Demon who then goes through a 15 minute explanation of the events so far (reason why I dont get why so many people didnt understand the film) which serves the purpose of updating moviegoers with no deductive reasoning, and filling in the blanks for Rose to cement some sympathy for Alessa into her heart. Once the Demon knows she has won Rose over with her sad story of Alessas torment and the evil occultists she sends a hint to Christabella as to where Sharon is being hid. I believe this because the Demon tells Rose the occult members will soon find Sharon and burn her (how would she know if she hadnt clued them in :P). This is the final piece the Demon needs in order to gain the services of Rose, and also another point that is up for different interpretation. However going from my original idea of the deal between Alessa and the Demon (Alessas soul for the Demons help) I believe Rose made a similar deal. Rose made a deal with the Demon that in exchange for Roses soul and her help, the Demon will help Rose get Sharon back, which just so happens to also help the Demon get into the Church. So Rose takes the deal and the Demon hitches a ride in Roses body in order to get into the Church. Now some people might ask at this point well why didnt the Demon just get into the body of one of the occult members to get in? Well I believe in order for the Demon to use someone, they need to accept the Demon and ask for their help (as was the case with Alessa). So now skip ahead again and we get to the final battle between the occultists and the Demon. This part everyone should understand, basically Rose brings the Demon into the church and when she gets stabbed the Demon comes out. This allows the Demon to enter the Church and bring Alessa in so the can exact her revenge.
