From what I've read a couple of villagers find a way out of the cave to another part of the island. What happens there ... well, we'll find out eventually I suppose.
From the "lost children" part of the title we get a clue, and I am sure that Arther and/or Barbara have posted either in this or other threads that the GC doesn't appear in VV2. I couldn't be bothered to read back through all the old posts, though.