I'm just skimming this thread for the first time, and will read it more carefully later. In the meantime, I'd like to speculate a bit about the perceptions of children, and about adults recalling childhood experiences.
When I was young - maybe 12 or 13 - my mother and aunt told me that when they were young they saw fairies dancing at the foot of their bed. They were quite insistent that they saw this, but didn't provide much detail. I'm sure something happened to them, but I'm not sure what. When I brought it up a few years later, they were more dismissive, saying they must have fantasized the event.
So, as others have said, children will color their experiences based on their world view. My mother and aunt interpreted their experience as fairies, and the Isle of Wight kids saw something they described as much like a clown, but we tend to think these can't be objectively accurate descriptions. Were ether of these events something that could even be experienced by others, especially adults, even if that experience would differ - on a phenomenological level - from what the children experienced? The mention of the two workmen on the Isle of Wight suggests the answer is no.
It's true that human brains get "rewired" a few times as we grow up. The skills required by an infant just discovering the world are different from those of a 5 or 6 year old beginning to adapt to more formal learning, and different still from those required of an adult. There are times I think children can see and hear things that we just can't - like that feeling you get when your cat stares at an empty spot in the corner as if something is going on there. It's not that we are totally incapable of perceiving these things, it's just that we tune out those things that don't fit in with the needs of adult life. (My wife tells me that several times in her adult life she has perceived extra-dimensional "shadow people" walking through walls and such - although this is probably no more accurate than the fairy or clown perceptions.)
Unfortunately, when we do adapt to the adult world, I think we start filtering our memories as well, and the filtering gets stronger with time. The memories of the fairies were still relatively "real" to my mother and aunt when they first told me about it, but a few years later their logical adult minds had helped to rewrite that a bit. If the Isle of Wight children are still alive, I would not be surprised if their recollections were less spectacular than their original story.
One other thought: I wonder if the adaptation to adult life is also an adaptation to contemporary life. There are several films I saw in my college days that I thought were quite accessible and logical, but now find slightly more perplexing. (Cocteau's Beauty and the Beast and Murnau's Sunrise are examples.) I think as we move further away from the time in which certain works are produced, we also move away from the shared body of understanding that allows them to speak to us.