The Blair Witch Project: 7 Most Compelling Fan Theories
3. The Culprit Is The Spirit Of Rustin Parr, NOT The Blair Witch
The children who were murdered in the 1940s were not victims of the Blair Witch, but of a recluse who claimed to have been forced to act on her behalf. The locals tell of how Parr would kidnap children in pairs and take them back to the basement of his woodland home, making one face the corner while he killed the other - much like Heather and Mike are implied to have been killed at the end of the film.
This theory suggests that the correct explanation is indeed a supernatural one, but that the entity responsible for the filmmakers' disappearance is wrongly assumed to be the Blair Witch. The manner in which the filmmakers are killed (the basement; Mike facing the corner) hints more towards the culprit being the murderous ghost of Rustin Parr.
Although Parr had claimed to be doing the Blair Witch's bidding until she was satisfied enough to release him from her service, who is to say that he was not just a schizophrenic who was familiar with local legend? Or perhaps he was perfectly sane and simply an evil bastard using the supernatural as a cover for his own sick urges?
Either way, many fans believe that the Burkitsville woods are haunted, not by Elly Kedward, but by the spirit of the madman who in life had been obsessively devoted to her legend, and continues to be just as devoted in death.