Even allowing for problems in translation, Chinese Ghost Story is thoroughly odd. It may well take you more than one viewing to figure out everything that is going on. I wouldn't even posit on where they got the theology behind it.
However, it is still a highly entertaining film. It is a love story that appealed even though I despise love stories and a comic adventure such as I've rarely seen. If you don't mind things not entirely making sense, you should love this film.
Chinese Ghost Story uses an interesting combination of computer and cell animation. The combination is not seamless as in more recent films, resulting in a very interesting look. Meanwhile, Chan experiments with the possibilities offered by the combination (look near the beginning when the camera cranes through solid ground).
Best line in the movie 'Scissors of Heaven.'