We may not be so sure what to think about the children and their mysterious nighttime escapades, but the Governess certainly knows what she thinks of all of it – she's even more convinced that the children are meeting up nightly with Quint and Jessel and that, when the children are alone together, they're talking about their ghostly friends.
She comments rather oddly that seeing what she saw would have made Mrs. Grose crazy, but it's only served to make her (the Governess, that is) more lucid.
The Governess comes right out and declares that the supposed innocence of the children is just a game – instead of belonging to her and Mrs. Grose, they actually belong to Peter Quint and Miss Jessel.
Mrs. Grose, shocked and horrified, asks a good question to which we don't really receive a good answer: she asks why Quint and Jessel would do such a thing. The Governess responds confidently that it's just for the sake of evil, and that they seek to destroy the children somehow.
The Governess comes to the conclusion that the ghosts, by appearing at a distance (like atop towers or across the lake) are trying to lure the children into pursuing them, and dying in the attempt – and the children will succumb eventually unless the two women prevent them.
Mrs. Grose decides that only the children's uncle can possibly protect the children from this deadly harassment, and that the Governess should contact him, despite her agreement never to do so.
The Governess disagrees strongly – after all, what could she possibly say to her employer to explain what's going on at Bly? However, Mrs. Grose remains insistent that the master should return to help with the problem.
The Governess worries that Mrs. Grose might send for their employer.
In a rare moment of clear self-perception, we see her worry about his scorn and contempt if she should admit to failure and call him in as backup. The Governess takes pride in her obedient service to him, and her ability to stick to the terms that he set. She's so determined to keep him out of this trouble that she threatens to leave Bly if Mrs. Grose contacts him.