I guess it's kind of a pain to be the target of an investigation, but nobody's life was ruined.
a) If the system worked, the initial photos would have been checked and then the complaint would have been disregarded.
b) If the system worked, innocent parents who provided a loving and safe home for their children would not have been treated like criminals.
c) If the system worked, the state would not have kept pushing in the hope of getting some sort of conviction in a case where it was manifestly clear that nothing had happened.
d) If the system worked, the children in the case would not have been subjected to invasive and personal questioning by government functionaries.
Accusations of pedophilia do ruin lives, and no one should ever have to go through the hell of proving their innocence in a case as flimsy as this.
Your statements (a) and (c) seem sound to me. (b) and possibly (d) is a necessary part of the system. If guilt can not be ascertained without investigation then practically some innocent people will be treated like criminals by being investigated. (d) may be a necessary part of such investigation depending on the allegations.
That said in the OP's case I don't think (d) should have happened and I'm concerned that the investigators could have effectively opened the door to improper sexual activity by asking the children questions like "did an adult touch you between your legs" or something that would lead the child to see this as a forbidden fruit that they had previously not regarded but now desired to explore.
Ruined maybe not, but based on the article and other comments in this thread there is clearly a lasting effect felt after having to go through such horrendous circumstances.
The uncertainty, anger, frustration, guilt, depression etc are all things which do not just stop when the case is dropped.
All these people needed was for the person making the original accusation to think for themselves and make a rational judgment rather than simply "do their jobs".
I guess it's kind of a pain [..]
I'm sure you've met someone who did something stupid, and every time you come across them it springs to mind. How would you like it if that was you, and the something stupid was being accused of was child pornography? Everyone who heard about it didn't necessarily hear the resolution or the circumstances.
... This is the longer and cleaner version of the "you can build a thousand bridges" anecdote.