I rented “Paranormal Activity 3” from Redbox and we found it took a disappointing twist in that the Grandmother is a practicing witch and the entity murders the mother and her new husband, but it is not in a fire that is referenced in the first movie. Another annoyance is that it is like a prequel for another prequel; to get a sense of completeness, you will have to watch the next movie that comes out.
I think it would have been best to leave the reason the girls were targeted by the entity more unknown and random where it could happen to anyone and took away from the original movie where you go home and when you hear an unexpected thump or creak you wonder if it is something more ominous.
