There is a horror/thriller movie i have been trying to find out for some time, can someone help me solve it?

this story is about a family that moves into an old house,(or have been living there) and they have a little girl.she often plays in those little plastic cottages you can get for young girls. but when you see her playing with her"fairy friends" they are very grotesque looking. the fairy-gnomes whatever they are are the subject of the terror in this movie as they place tricks on people. And when the gardener tries to warn the family, they use a tripwire and make him fall on a pair of hedge clippers. eventually, their little girl goes missing and why are looking for her, when they hear her favorite music box(which they used to lure the little girl into the tunnels i belive) and they find out there is a network of tunnels under the house, in which these fairies live. i do not remember if they get her free or not but i do remember them finding her wrapped up in some sort of a cocoon. i also remember one other scene, them ripping wallpaper off the walls and finding words or blood underneath... but im not sure where that fits in. any help would be apriciated because ive been trying to find this for a while. it was probably made within the last 20-25 years.