Continuity mistake: When Nancy goes to the police station in her dream, she looks down at Rod through a window as he sleeps in his cell. The first shot shows him sleeping completely on top of the covers but when Freddy enters the cell, Rod is partially covered with a sheet.
Continuity mistake: When Freddy is set alight, he runs up the cellar staircase which has steps with no backs to them. Then when he is hit by the door and rolls down the stairs, the staircase has changed, and the backs of the steps are there. (01:19:50)
Continuity mistake: When Nancy is in the bath, Freddy's hand comes out from under the water. Between shots Freddy's hand goes from having no foam on it, to being covered in foam, to having no foam on it once again. (00:30:55)
Continuity mistake: At the end of the film the two girls holding the skipping rope chanting the Freddy rhyme swap sides between shots. (01:25:10)
Continuity mistake: When the police arrest Rod you see the policeman on the left holding his gun with both hands. When it cuts he holds it with his right hand only. (00:21:50)
Continuity mistake: When Glen sneaks into Nancy's room, she has him turn off the lights and it is pretty dark in her room. When she wakes up to her alarm, it is still night outside but now it is a lot brighter in the room.
Continuity mistake: When Nancy is walking to school, Tina's boyfriend grabs her and he is not wearing a T-Shirt, only his black leather jacket. When she visits him in jail he is wearing a white T-shirt and the leather jacket. When you get arrested they don't let you have a jacket.
Factual error: The moment Nancy's digital watch hits zero, her bedside clock rings waking her up. You cannot set an old, mechanical style alarm clock to go off with anything like that level of accuracy. (00:32:00 - 00:33:18)
Continuity mistake: When Nancy lays in bed, she looks up at the wall, just after it has been streched by Freddy. In the wideshot her left arm falls off the pillow, yet in the next closeup it's back on the pillow resting by her head. (00:13:40)
Audio problem: When Rod Lane runs away from Lt. Thompson, who is trying to arrest him, Lt. Thompson yells "Hold it," but his lips did not move. (00:22:30)
Continuity mistake: After the bathtub scene, when Nancy opens the mirrored medicine cabinet and removes the bottle of Sta-Awake, her fingernails are short as usual, but in the bottle's closeup Nancy's fingernails are quite long. (00:34:10)
Continuity mistake: When Nancy leaves the kitchen to go to school, her orange backpack is empty, but when she storms away from her dad after he arrested Ron, her backpack is full.
Continuity mistake: Before Freddy kills Tina and takes her above her bed, the amount of blood on the sheets changes between shots.
Continuity mistake: After Rod's funeral where Nancy's mother is about to get into her car, there's a shot of her saying "I'm going to get her some help". There's a gravestone behind her that reads "Coulter". When we see her entering the car, with her relative position unchanged, the gravestone reads "McRenolds" (00:47:05)
Answer: The scene you are referring to is a dream sequence. In dreams everything is different and how they change throughout the movie is no mistake.
SAZOO1975