One of the recurring themes of my Otherworld Series is that history is never-ending. Events scroll onward forever, one leading to another to another, continuously. Therefore, what defines a story is simply the framing. For example, look at the history dealt with in the fairy tale "Snow White." You'd have a very different story if you chose to start it with the king and queen's desire for a baby, through the ups and downs of their disappointments, and finally end it happily ever after with the birth of their perfect baby. Or what would the story look like if you chose to end it with the queen's death? Tragic! Perhaps you could focus the entire story on Snow White's time in the woods - start with the stepmother's order to take the princess away, and conclude with the seven dwarves taking her in to live happily ever after with them. You get a different story again when you end the traditional way with Snow White marrying the prince and wreaking hideous punishment on the stepmother. And of course you could just as easily start the story with Snow White's marriage and end it some time later, with her own children, or with the prince's coronation as king, or perhaps ending at the close of some epic battle the prince will no doubt fight, making a happy ending if the prince's army is victorious, a tragic ending if he's killed, perhaps a bittersweet ending if the country is saved but the prince dies… The point here is that all beginnings and endings are in a sense arbitrary and it's the job of the storyteller to choose how she wishes to frame the tale. It doesn't make sense to argue about whether happy endings or sad endings are more "realistic," because both happy and sad things do undeniably occur and it's purely up to the storyteller to decide whether to end a story at a happy point or a sad point in the continuously unfolding history.
When I tell stories, I insist on happy endings, or at least endings that leave me with a sense of satisfaction and a sense that things have turned out right. (I'm happy with the ending of the movie "Casablanca," for example, despite its not being a typical happy ending.) I refuse to end my own stories at tragic points, quite simply because I don't enjoy reading stories with sad endings, so why would I write them that way?
There are a number of reasons why I don't like sad endings. First of all, if I want to hear about bad stuff happening, I can read the newspaper. The news is full of disasters and tragedies. (Does that mean bad stuff is more realistic? No; it means that newspapers end their stories at the terrible climax and don't continue the story beyond, to the overcoming or the redemption or the solution to the problem.) Newspapers function under the belief that what's interesting is the disaster, but to me, what's ultimately interesting about a story isn't really the disaster itself, but how a hero might react, respond, and overcome. So any story that stops at the bad stuff is, in my opinion, leaving out the interesting part of the plot.
Secondly, there's what I always think of as the "Jesus, Grandpa!" phenomenon, with reference to the point in The Princess Bride by Goldman, where the grandfather reads that Buttercup marries the wrong man. The boy listening exclaims (in the movie version) in outrage, "Jesus, Grandpa! What'd you read me this thing for?" We read stories because we derive satisfaction from seeing things connect in logical ways, from seeing loose ends tied up, from seeing problems worked out after fearing that there was no hope, from immersing ourselves in a vision of a world that is more than merely random. Is this a realistic vision of the world? Maybe it is, maybe it isn't, but it is certainly real and true that humans need such a vision, and one of the jobs of art and literature is to provide it for us.
And finally, there's a moral dimension to every telling of every story, whether it's meant to be explicitly moralistic or not. That is, the storyteller's choices about how to frame the story give the readers or listeners a message about the world. Do I show characters struck helpless by evil fate or do I show them struggling to overcome? Do I show events having consequences, and if so, do I focus on short-term or long-term consequences? Do I show tragedies as endings, middles, or beginnings? Personally, I believe it's better to give the message that life can go on beyond bad things.
Whenever I talk with children about writing, I always encourage them to think about what sort of endings they like, and try their hand at various different ways to craft a satisfying ending for themselves. But I always pledge to them that all my endings are happy, because I love Happy Endings!
[Pictures: The poisoned apple, illustration by Jennie Harbour from My Book of Favorite Fairy Tales, edited by Eric Vredenburg, 1921;
The magic mirror, illustration by Lancelot Speed from The Red Fairy Book, edited by Andrew Lang, 1890.
Given their dates, both these illustrations were probably originally done with pen and ink, and then reproduced as wood blocks for printing in the books. But I haven't confirmed that on either.
(Both images are from the wonderful collection of fairy tale illustrations at SurLaLune.)]