I found it interesting that the old lady with the grandson that practices magic lived in Laura palmers house before. She lived in the trailer park when Teresa banks died. In "fire walk with me" she gave a painting to Laura palmer and said "this would look good on your wall". The painting was animated and seemed to link to another dimension. The grandson who practices magic almost looks like a kid version of David Lynch. Is the kid david lynch and he is practicing magic or perhaps this is all his dream and everyone in the show is living in his dream?