It was about a seaside town and travelers were being murdered by the residents, fixed up and made to look normal by some kind of mortuary embalmer and made to join the town. There was a scene were some travelers were burned near to death on the beach in a fishing net. The only person who turned out to still be "alive" was the embalmer... who was shot and performed an embalming on himself at the end of the movie to join his flock.

Double posted, can't seem to delete this - see below

Sounds like this:
Dead & Buried (1981) - IMDb (http://www.imdb.com/title/tt0082242/)

....It is revealed that Dobbs has developed a secret technique for reanimating the dead, and all of the townspeople are reanimated corpses under his control. Dobbs considers himself an "artist" who uses his zombies to murder the living in order to create more corpses on which to practice his reanimation technique.....


(here's an image of the fish net burning scene -)



http://www.filmsite.org/photos/deadandburied2.jpg