Instructions
Use a Gremlin
Approach the gears in the center of the Stretching Room. Aim at one gear and hold down "B" to spray it with paint. Shake the Wii Remote to spin the middle gear. This takes you to the second floor.
Aim at the painting of the man in the TNT barrel. Hold "Z" to thin out the painting. Jump through the hole in the painting.
Spin-attack the gear to move the platform around. You find a gremlin in the new area. Talk to the gremlin and he arranges the paintings in the correct order, opening the exit for you.
Arrange the Paintings Manually
Walk up to the TNT painting on the first floor. Spin-attack it until it shows only the man's feet and the bottom of the TNT barrel.
Spin the graveyard painting until it shows only the tombstone heads. Spin the jungle painting so it shows the piranhas.
Go to the gears on the first floor. Fill in one gear with paint. Spin the gears and rise to the second level.
Spin the TNT painting to show only the man's boxers. Spin the graveyard painting to reveal a tombstone and the midsection of a woman. Spin the jungle painting to show a man carrying another man.
Return to the gears. Spray another gear with paint. Spin the gears and you go to the third floor. Spin the paintings so the first one shows a man's head, the second shows a woman's head and the third shows a man's head, shoulders and chest. This opens the exit door.