Quite a dark family movie, although the title should have given it away I suppose. When the kids rescue their Aunt from the cave, they are suddenly hunted by an army of ravenous leeches as she decided to have a quick snack on the way. Olaf shows up on a Victorian-powerboat, and rescues the kids but leaves the Aunt to be eaten alive.
They are taken hostage and Violet forced into a borderline-incestuous marriage, but under the ploy to the judge reading the marriage vows that it is all a stage play. Meanwhile Klaus tries to rescue the baby who is locked suspended up high in a cage, and discovers the meaning of the eye window and spyglass symbols. He uses the sun's reflection to burn the marriage certificate and Olaf gives the game away to the audience, as he is 'a terrible actor' (not my words, Carrey - you can do no wrong after Dumb and Dumber!)
Olaf is under arrest, and forced to endure all the tortuous things he did to others including surviving a train wreck and the killer leeches. We are told he soon escapes, set free by a jury of his peers.
The kids are taken by Timothy Spall to their next home, a little wiser after their experiences, but still living day-to-day in fear of the evil Count Olaf.