As the name suggests, fantasy body horror involves a nightmarish and cartoonish transformation which can only occur in a films that are not concerned with realism. The Fly almost fits this categorization, but is far too grim for the fantasy sub genre.
Another important facet of fantasy body horror is the absence of subtext. A transformation that attempts to express a larger idea suppresses visceral repulsion due to intellectual engagement. But your typical bizarro fairy tale is not attempting to inspire thoughts other than "Wow! It would be truly unpleasant if such a thing happened to me." For some people (e.g. me) this makes such films oddly unsettling. So what does fantasy body horror look like?
In the third installment of the Leprechaun series, the appropriately titled Leprechaun 3, the titular character goes to Las Vegas for some reason. While there he loses a charm and wants it back. The vapid Vegas denizen who stumbles upon the charm soon feels the wrath of the Leprechaun's dark imagination:
Cautionary tale about the pitfalls of vanity aside, there is not much more to this scene than what happened. Because of this you are left to focus purely on what is on screen. Without an allegory gobbling mental bandwidth you can simple ponder what it would be like to have duck lips. This is not something you commonly think about, yet when you see it in a movie it becomes oddly plausible. If I ever get cursed with duck lips my I think exploding while attempting to squeeze through a doorway would be a merciful escape.
