Let me preface this by saying that I LOVED this movie. Needless to say... SPOILER ALERT.
Here’s what I think should have happened. The teacher, Dr. Woodward, should have died in the crash. The kids find his body, he’s clutching the map with weird notes scribbled on it. Charles (the kid director) and Joe are fond of the teacher so they go to the school to reminisce and that’s when they crack open the DUNGEON (the place where old man Woodward kept his contraband).
Sifting through Dr. Woodward’s belongings Joe and Charles discover his notes from when he was a secret military scientist. Joe and Charles THINK that Dr. Woodward was writing a Monster Movie, because who would ever think their teacher was a super secret military scientist. So they change their Zombie movie to a Monster movie to honor Dr. Woodward’s dream.
We hear snippets from the files, about what the monster is capable of (psychic powers, it’s size, cocooning people) throughout the movie as the town is dealing with the strange goings on. The kids are oblivious to the threat as they film their movie. It’s only until they get the developed film back when they realize IT’S ALL TRUE!
Then. At the end when Joe is being clutched by Super 8 the Monster, he offers himself as a sacrifice. “Take me, leave my friends alone!” When the monster is about to take off in the rebuilt spaceship with Joe, Kyle Chandler (the Dad) drives up and has to save his son. A reverse from the Baseball Camp-pushing away scene at the beginning, and also a reverse of Close Encounters (don't get on the spaceship). Joe realizes that his father does in fact need him/ love him. The end.