The children are sent to Paltreyville, where they are forced to live in a dormitory and work at Lucky Smells Lumbermilll (where they are paid with coupons). The book is indeed miserable! Olaf disguises himself as a receptionist named Shirley, Klaus becomes hypnotized, and the kids are fed only one meal a day. If it wasn’t for the fact that readers by now have really come to like Klaus, Sonny, and Violet, they might not have the stamina to endure any more misery.
For a critical overview of the entire series, see A Series of Unfortunate Events (Books series overview).