Continuity mistake: Throughout the entire movie, the irregularly-sized characters are constantly changing size when compared to one-another. Except for Barky (even Junior, he is awfully big for a baby) I.E. when Bastian accidentally steps on the gnomes' house, the gnomes are the height of Bastian's shoe, yet when they run out of the house, they are as tall as his leg up to his knee cap.
Plot hole: Towards the end of "The NeverEnding Story 2", Bastian's dad became aware of his son's adventures in Fantasia. Yet, in this film, he reacts to the news about Bastian stealing the NeverEnding Story as if he's never heard of the book before. Adding to that, he does not recognize the Auryn on his son's sweater nor does he know what it can do.