Oh hey, glad you liked it! The last ghosts that appear (Napstablook fellows) are supposed to randomly attack or scare enemies! Sort of like poking them and scaring, or actually hurting them. Though they were implemented like 3 hours to the deadline so I can understand it being confusing.
The original idea had an ending in mind, as if you avenged your village and could now try to live your life in peace. But we'd give the player the option to keep on fighting infinitely. But... we ran out of time.