I've solved the mystery
Here is what really happened.
They went up to Canada to shoot a bigfoot/alien movie, with a bunch of kids going into the woods to find bigfoot, but it turns out it's aliens.
The movie was so *beep* bad that the distributors refused to release it. So in panic they renamed it 'Blair Witch' just 2 months before it was suppose to come out, re-shoot a couple of scene and edited it during a last weekend frenzy.