You can get a bus up there from the city (numbers 3,4,5 and 83 go there. It’s quite easy; look for Nyhavnsveien on the board) or you can walk if you want to save the 41 krone bus fare.
The place is laid out in the style of old Bergen and you will find actors milling about the place in character and eager to show you round ‘their’ houses and tell you about their life in 19th century Bergen (in English).
I thought it was well worth the (somewhat steep) 80 krone entrance fee, although if you really don’t want to pay that you can just wander around the grounds a little and there’s a nice picnic area if the weather is good.
In the story Luke (Jasen Fisher in the movie) goes to Bergen to be with his Grandmother where she tells him stories about witches, including a gruesome tale about someone who became locked in a painting after meeting a witch.
The action then moves back to England, where much of the rest of the movie was filmed (at the Headland Hotel in Newquay, Cornwall).
I don’t think I’ve ever seen the movie but the book is an excellent read for children. Apparently they changed the ending for the movie, which to me is a travesty.
Maybe best to just stick to the book. Gamle Bergen is worth a visit though.