This から stands for the starting point of sequence, just like English from in "from the largest to smallest". The dictionary says:
in the order they reach readiness
(starting) from what has been made ready
This seems to me to be the 'set expression' use of に続いて, to mean "following" or "in the wake of" or similar (I suppose if you wanted a semi-structural translation, you could say 'continuing on from'?). To take your translation:
On the 7th, in the wake of the children who walked in the guise of people ...
あまり気持ちのいいものではない means something negative, "It's not very pleasing". それに indeed means "on top of that", "in addition", etc. So, as you said, logically speaking, something negative should follow.
But human emotion is not always logical. Here, he started the sentence with それに to continue something negative, but in the middle of the sentence, at the point of ...