Three children chopped up the bodies of two girls and a boy who were beaten with metal pipes during the filming of a "snuff" movie, a prosecutor says.

The children are the victims of a child molestation ring, investigators say.

"We do not have sufficient evidence at this point to file homicide charges," Deputy District Attorney Rick Lewkowitz said Thursday in Municipal Court.

Investigators say five suspects, four of them employes of a suburban restaurant, forced children to participate in macabre sex rituals involving satanism, witchcraft and mock weddings.

Lewkowitz said three girls told investigators they were present when the three children were fatally bludgeoned in the basement of a Sacramento house in 1982 during filming of a "snuff" movie -- one that depicts a murder.

"Three children are individually telling us they were taken to a basement of a house where three other children were present," Lewkowitz said. "The three children were given drugs. A metal pipe was taken to the heads of each of these three children. The blows were of sufficient force to have probably killed the children."

He said that the three girls told of being given "cutting instruments while cameras were going" and that they described what "they had to do to these children, to the dead bodies . . . the cutting up of the bodies."

Investigative reports quote a grandmother of some of the witnesses as saying the children described the victims as two girls about 7 or 8 years old and a boy of about 6.

The disclosure came during a hearing in Municipal Court on whether to reduce the $500,000 bail for the five defendants, who are charged with 77 counts of child molestation. Judge John Stroud continued the bail, despite arguments from court-appointed defense lawyers.

In Los Angeles, Municipal Court Judge Aviva Bobb ruled today that a hearing for seven defendants in the McMartin Pre-School molestation case will remain open to the public when children testify next week.

Seven former teachers at the school are charged with 209 counts of molesting 42 of their pupils over a five-year period beginning in 1979.

Bobb has ordered that the children testify from the witness stand in a closed courtroom, with the public and reporters viewing the proceedings on television monitors in an adjacent room.