The other people trapped in the Town are? If Tabitha and Jade are reincarnations of the parents who tried to save their children originally (and also previously Miranda and Christopher) and the monsters are the parents who killed the children? (obviously some are just collateral damage like Jim, just being stuck their because he was married to Tabitha etc)
Spoiler:
it all becomes confusing, for example, the woman effectively killed her new born child by "accident" in the real world, was that therefore not an accident? Was that why they ended up back in the town. Is the old guy that appeared at the end of the episode connected to the boy in the white suit.
Of all the things that they did in the town, why was digging the hole the "biggest" mistake I could go on all day
I could go on all day 
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