Tales of the Ghostwood

A collection of legends surround the Ghostwood, tales likely inspired by disappearances and mysterious deaths. Parents warn their children not to stray so far into the woods that they cannot see the edge, but of course some do anyways.
Several components are commonly featured in the stories, such as cursed animals and strange, fey locations in the forest.

Summary

The Owls

The owls are said to be bad omens and harbingers of death. Those who become lost in the woods do not die, but instead become giant owls, doomed to forever wander. They yearn to see their families again, are said to steal away children who enter the forest, and lead people astray until they are lost in the deep woods.

The Demon Pool

Deep in the forest, legends tell of a small clearing, full of hemlock, that contains a pool, black as obsidian. Anyone who touches it or crosses it vanishes into thin air.

Changelings

Some of those who are assumed lost in the forest have come out again, sometimes after many years without having seemed to age. They are always different somehow, and either cannot remember or will not speak of what they saw.
Some children playing in the forest captured the king of the rabbits, who promised to give them a great deal of gold if they set him free and came to his palace. They returned twenty five years later as though they had only been gone a few hours, and seemed to have strange powers of clairvoyance.

The Sorcerer's Tower

Deep in the woods, a cruel sorcerer lives in a tower. He is said to make strange hybrid beasts to act as his servants: large winged and horned jackrabbits with crimson eyes and large fangs, great bulky owls with forelegs and claws, squirrels with claws and the bills of ducks, enormous horned foxes and flying weasels. Anyone who ventures too close to his domain is captured by his foul beasts, and become experiments in his bizarre fleshcrafting.

Historical Basis

People have indeed gone into the woods and not come back out, but there are no concrete records of any of the more mystical elements.