My Film Music class watched The Wizard of Oz last night, followed by my daughter watching it today while home sick. I then read the first three chapters of the book to my daughter, thanks to Project Gutenberg. There are many differences between the book and movie versions, including the switch from silver to ruby slippers (which ruins the Populist movement metaphor). But the biggest difference is that the book Dorothy really did go to a magical land, whereas Judy Garland's Dorothy just had a concussion-induced dream. Why was this change made? In the same year the film version of Wuthering Heights didn't make Cathy's ghost a figment of Heathcliff's imagination. So fantasy films weren't unheard of in 1939. But Cathy's ghost was the supernatural representation of adult longings (mostly, though I found Heathcliff and Cathy to be rather immature). Oz was the supernatural representation of a child's desire to run away and explore new things. I think society did not encourage this desire in their children. World War I and the Depression might have made trips abroad a frightening idea. The cost was unbearable and isolationism was back in vogue.
I always felt that the movie version's ending was a gyp, taking away the wonder of a magical new place. And it saddens me a little when my daughter points out that it is all just a dream, so she hasn't been transported to a new place of adventure and magic either. Thus we are reading the book version, so we can both be lifted away by a cyclone to a magical land surrounded by a great desert.
Update: I just found out via IMDB that the all-just-a-dream idea came from the 1925 silent film that had Oliver Hardy as the Tin Woodman. And Frank Baum didn't like the idea.