Other mistake: When Taryn turns into a punk and walks down the alley way, you can clearly see Freddy's back along the bottom of the camera shot as if he is trying to pass the camera for the next shot. This happens as Taryn looks down the alley. However, if that was meant to happen, wouldn't she have seen Freddy, and not have been so scared when he approached her from behind?
Continuity mistake: When Max turns off the lights, the switches are already down - he doesn't move them in any way (neither up nor down) and therefore hasn't made any actions that would alter the current lighting situation, however the lights turn themselves off anyway even though it is apparent the switches were not moved. Nobody else moved any lightswitches either.
Continuity mistake: In the scene where Freddy turns into a puppet, he cuts his own strings with his knive fingers to get down and as he falls you can see some strings still attached to him, but when the shot changes and he lands on the floor, there are no longer any strings attached to him.