Being Swedish and roughly of the same age as the protagonist of this movie I must say that I found the story quite far-fetched when I saw it on television during the mid-80s. It was just that kind of pseudo-realism that made the cultural elite of Sweden go in trance back then. As the author of the novel, P.C. Jersild, was highly reputable, I read the novel that the script was based on, and found it overall better, perhaps a bit ethereal.
Kay Pollak became, however, before long known as the 'enfant terrible' of Swedish cinema as he more or less tried to bleed the Swedish Film Institute for more and more financial support of yet another pathetic picture project of his, "Love Me!" (also starring Tomas Fryk), released in 1986, and an immediate flop.
Pollak later on released a video show, "To Choose Happiness", a sort of stand up, where he discussed the subject of managing conflicts. A narcissistic female boss of mine had the staff watching it in order to manipulate us into believing that instead of reacting at her mistreatment of us, we should think as Pollak suggests: "So she hates me? Wonder what bad things I've done? Better walk the line onwards, otherwise I'll start feeling unhappy..."
As for "Kids' Island", I do suspect the enthusiasts of this film of merely being fascinated by the infamous profanity in it that was staggering even by Swedish standards. One has to feel sorry for the young actor. Did he regret being there? (After all, he wasn't as bad an actor as Pollak was a bad director: check out one of his better roles in "The 9th Company" (1987) about a military service unit where the inductees begin a large scale operation of selling out the army supply.)
It might be of interest to know that, in Sweden, documentaries or movies dealing with people exposed to various hardships frequently are referred to as "Social Porn"...