One of the worst things about this movie for me is that Anakin basically turns to the Dark Side when he murders the Sand People. I remember seeing it the first time and thinking ‘well, I guess he’s evil now’. Then he admits this genocide to Padme, and she says, and I quote “To be angry is to be human.” Um, what? The guy just confessed to genocide.
So one idea I had to fix this is was that the slaughter could be played as a dream.
How it might work:
End Shmi’s death scene before Anakin becomes genocidal, then cut to Obi-wan’s story for a bit. When it cuts back, the nightmare scene from Naboo happens here, recolored to appear more in line with the interior of the homestead. It might actually help sell the idea to have Yoda picking up on his pain during this scene. Then we have the garage scene, and remove the present tense ‘they’re dead’, which implies that it wasn’t just a dream. Leave everything else that is in the past tense. Since there’s still some ambiguity as to whether it was just a dream, one final change would be a cutaway to Padme after she asks what’s wrong, where Anakin says ‘nightmares’.