In an early scene, Dorothy finds that no one believes her about her visit to Oz and ends up being sent off to a psychiatric hospital where she's supposed to undergo experimental electroconvulsive therapy and can hear other people screaming in the building:
There are patients who have been damaged... locked in the cellar.Returning to Oz, she finds that the place hasn't turned into the Utopia that we would have imagined would occur following her return to Kansas. It functions as a pretty good examination of the failure of such phantasmic visions. New forms of antagonism have emerged to show cracks in the pretty picture of harmonious munchkin liberation. The Yellow Brick Road has been destroyed, Emerald City has been decimated and its inhabitants turned to stone, and strange apparitions appear in the rocks that surround them. Return to Oz exposes the dark flipside of quests for ontological completion. Things were left out of the original harmonious picture and returned in more horrific forms. When Dorothy failed to return due to the unexpected possibility that her radically new perspective would have no way of being assimilated in a meaningful way into the symbolic order of her family in Kansas (the only way they can rationalize her stories is by assuming that she's gone mad), things get even worse than they were during the reign of the Witch of the West.
In much the same manner as the Stalinist terror revealed the superego component of desire for totalitarianism that underlied the October revolution's quest to resolve class antagonisms, the decay of Oz is a glimpse at the horrifying real that underlies attempts to repress the violence of primordial desire. Whereas this component was sublimated at the end of the first film, it breaks through in a horrifying manner in the second, showing the impossibility of totally fulfilling one's desire, due to its chaotic and shifting nature. To fetishize a single gesture as constituting political liberation, in and of itself, creates the threat of recreating the same evils that we fought to destroy. Rather than assuming that the defeat of the Witch of the West will liberate Oz, we need to be eternally vigilant about new forms of oppression.
Now that I think about it, the original Wizard of Oz also had some creepy parts in it. That stuff just gets covered up by the film's ossified status in the canon of family movie cliches. We choose to remember "There's no place like home" and to not think about how strange the lady riding away with the dog, the flying house, the monkeys, or the desert that turns people to sand are because we're so used to them. Oz was always fucked up, and to assume that there was some point in which it experienced completion is a bullshit before the fall fantasy.