Continuity mistake: When Lucy watches the video about the history of Johnny Bartlett, the sweat stain on Ray's shirt changes in the following shots. (00:11:30)
Continuity mistake: During the dinner with Lucy, Frank goes to the lavatory to dry his pants and when he pulls on the paper towels more than a foot is left hanging out the bottom of the dispenser. However, in the following shots it's either nothing or a some of it sticking out of the dispenser. (00:37:00)
Continuity mistake: After Mrs. Waterhouse says good morning to her children, in the wide shot she walks to the coffee table to get her mail. In the next close-up, a couple of things disappear from the table, as well as the pillow on the floor, which leans against the couch behind the table. (00:23:00)
Continuity mistake: When Patricia is in the kitchen, the ghost wreaks havoc and when she gasps at the exploding stove the refrigerator is visible. In the next shot when things tumble down from the top of the refigerator as it moves away from the wall, the shadows on the wall are completely different. Then the corner cabinet door under the sink opens fully, however, in the shot from under the table as she dives under, the corner cabinet is closed. (00:01:55)
Continuity mistake: When the 3 "flying" babies crash into their mother, look at the one in the red clothes. In the wider shot it has a lot of dribble on its chin, but this vanishes in the closer shot.
Continuity mistake: After Frank takes the urn from Lucy, he reaches the bench near the chapel and a wood chair lies on its side beside the bench. After Dammers catches the urn, that chair is now upright behind Frank. (01:34:55 - 01:35:50)
Continuity mistake: Running from the ghost, as Patricia crouches behind the couch at her home and shouts, "Please don't hurt me!", the throw on the couch and the pillows change positions between shots, before she falls onto the couch, as well as the pillows behind her head after she falls onto the couch. (00:01:15)
Continuity mistake: When Frank walks in through the Lynskey's front door he passes a table with assorted items, including a bouquet of red and yellow flowers. When Frank leaves their house, the positions of some items differ and the bouquet is arranged differently. (00:13:30 - 00:17:10)
Continuity mistake: During the dinner with Lucy at the restaurant, Ray's ghost knocks over the wine glass and the wine visibly spills onto Frank's vest, yet, the vest is dry in the following shots. (00:36:40)
Continuity mistake: When Frank's car is on Ray's lawn, until he pulls away, the position of the garden hose and bits of picket fence lying around on the lawn differ in the consecutive shots. (00:06:30)
Continuity mistake: After Frank nearly collides with the truck, he crashes through Ray's fence. The breaks in the picket fence differ depending on the camera angle. (00:06:15)
Continuity mistake: When Frank is in Lucy and Ray Lynskey's house pretending to get rid of the 'persistent residue of the departed', things in their kitchen (floor, fridge, counter, etc...) appear/disappear and/or change position between shots. (00:13:40)
Continuity mistake: When Frank reaches the chapel he places the urn down and there are scattered pieces of wood hanging over the edge of the bench. After Frank breaks through some of the wood on the chapel door he causes the pedestal to fall over on the bench and the wood is gone. (01:34:55)
Continuity mistake: In the sanatorium, after Frank accidentally knocks over the statue outside the chapel, the pedestal falls onto the bench sending the urn flying above. In the overhead wide shot the urn flies upside down as it reaches the window, yet, in the next close-up the urn is right side up as it comes through the window. (01:35:10)
Continuity mistake: When Frank hacks away at the door of the chapel, the broken wood at the openings differ in the close-up of Frank's face through the door and the following shots. (01:35:00)
Chosen answer: For the most part, the actors playing the ghosts were shot separately on blue-screens, and then comped into the scenes. (By removing the blue background through a process called "color keying", and placing them over the scenes) They were simply given a blueish glow and made semi-translucent to complete the effect. It was pretty cutting edge back in the 90's, but nowadays, it'd be very easy to make the exact same effect using a simple program like Adobe After Effects.