Glad you saw the nods to Captain EO in Skeleton Crew. I was able see EO twice visiting my aunt and uncle in the day, even buying a Fuzzball plush. I've found the short on YT.

People don't like dark endings, especially after characters seem to make headway, because it's tragic. In this case, it was an inevitable outcome, because every timeline they messed with went sideways in some way...and, it all related to their existence.

As far as the kids being erased or not, I see your point...like in Back to the Future. However, this's Science Fiction, therefore, the kids could conceivably be born to friends of the Hargreeves in the reset timeline.

The flowers were simply the Hargreeves still existing.