Do you remember if the movie was Australian? Because what you're describing sounds a lot like this Australian movie that I saw when I was a kid, too. It's called "The Quest" or "Frog Dreaming" (its Australian title). It's about this boy who investigates this spooky lake who the Aboriginees say has a monster at the bottom of it. The monster turns out to just be a donkey engine left at the bottom of the lake. Anyways it's a good movie and here's the link to it at the IMdB:
http://us.imdb.com/title/tt0091810/
Hope that's it, good luck!
