The slave sacrifices opened a dark doorway so Evil possessed his living children? Or did he sacrifice the kids, too, and they returned as demons? He says, "I tried to bring them back, but they tricked me" or something. Huh?
Also, those skinned hog creatures inhabited their bodies because the property is cursed, or did the crimes have something to do with their transformations?
He said the wife and kids were turned into demons and says he put the children where they'll never be found and later saying he put them where they belong meaning they turned into demons and then he killed them. I always took it to mean he tossed them in the well, but that's just me. Whether them turning was just to the outside visibility of an observer like with the outlaws at the end is up to you.
The curse turned anyone into a demon presumably without the knowledge of the person which is why the main guy couldn't understand the dog chasing him.