This is a pretty cool movie, quite a bit different from your regular fare. Incidentally, one of the two female lead actress - the wife of the woodcutter - is related to my wife. Then again, my wife has a huge family in Bhutan so her relations pop up all over the place! Have you guys seen the first movie directed by Khyentse Rimpoche? It's a neat, fun one, "The Cup" that tells the tale of a young Tibean monk in a monsatery in North India who's a football (soccer) fan and his efforts to watch the Worl Cup on TV, interspersed with stories of other monks, young and old:
http://en.wikipedia.org/wiki/The_Cup
About Khyentse Rimpoche - he's not the direct reincarnation of the Buddha, but a reincarnation of another high-ranking realized Buddhist teacher from the early 19th century.
http://en.wikipedia.org/wiki/Dzongsar_Jamyang_Khyentse_Rinpoche
There are lots of reincarnation lineages in Tibetan Buddhism, some are several centuries old (HH The Dalai Lama, the Karmapa, etc.), while others are more recent - lots of 1st, 2nd generation lineages around. There are several ways for a lineage to start, but usually it starts with one teacher who has reached such a high level of mastery that he can predict/dictate the next one in his line. Thus he becomes the first one in his line and it goes on from there.
Back to the movie, Travelers & Magicians actually did not do as well in Bhutan as hoped for - most of the public, having been exposed to a steady diet of Bollywood action and song/dance routines, found it a bit too high-browed!!! Since then the Bhutanese film industry has blossomed with the few movie halls in the country playing to packed houses as Bhutanese movies are churned out one after the other - it has gotten to a point where the movie houses do not have any space in their schedules to play Bollywood movies (which used to be shown all the time just a few years ago). Most of the movies follow the Bollywood formula of romance, action, drama with the de-rigeur song & dance sequences. These songs then become the pop-hit of the season. The current top movie star is the former Miss Bhutan.