Сначала дети испугались, что медуза подплывёт ближе, но потом долго смотрели, как дельфин выпрыгивает из воды.

Испугались is the past tense plural form of испугаться, which means to get frightened / to become scared.

A few parts to notice:

• испугал- = the stem
• -и- = past plural marker
• -сь / -ся = a reflexive ending

In this verb, the reflexive form is just the normal dictionary form: испугаться. It does not literally mean that the children frightened themselves in a straightforward English sense. It is simply how Russian expresses to become frightened.

Because the subject is дети (children, plural), the verb is also plural:

• дети испугались = the children got scared

Also, испугаться is perfective, so it emphasizes the moment they became frightened.

Because дети is the subject of the sentence, so it is in the nominative case.

• дети = nominative plural of ребёнок / дети
• It answers the question who got scared? → the children

If you used детей, that would be genitive/accusative in other contexts, but not the subject here.

So:

• Дети испугались = The children got scared
• not Детей испугались

Here что means that.

The clause что медуза подплывёт ближе explains what they were afraid of:

• испугались, что... = were afraid that...

This is very common in Russian:

• Я боюсь, что... = I’m afraid that...
• Он понял, что... = He understood that...
• Мы заметили, что... = We noticed that...

So in this sentence:

• дети испугались, что медуза подплывёт ближе = the children got scared that the jellyfish would come closer

Because the children were afraid of something that had not happened yet at that moment: the jellyfish might come closer.

Подплывёт is the simple future of the perfective verb подплыть:

• подплыть = to swim up / come closer by swimming
• подплывёт = it will swim up / come closer

Russian often uses the future after verbs of fear when the feared event is still in the future relative to that moment:

• Они испугались, что собака укусит. = They got scared that the dog would bite.

So even though the whole story is in the past, the feared action is future from the children’s point of view.

Ближе means closer. It is the comparative form of близко (near, closely).

So:

• близко = near
• ближе = nearer / closer

In the sentence:

• медуза подплывёт ближе = the jellyfish will come closer

Russian often uses this comparative adverb with verbs of motion:

• Подойди ближе. = Come closer.
• Подплыви ближе. = Swim closer.

Because смотрели is imperfective and emphasizes the duration of the action: they watched for a long time.

The sentence says:

• потом долго смотрели = then they watched for a long time

This fits naturally with the imperfective verb смотреть, which is used for ongoing, repeated, or extended actions.

If you said посмотрели, it would usually sound more like:

• they took a look
• they watched for a bit
• a more bounded, completed action

So долго смотрели is a very natural combination:

• долго
  • imperfective verb

This is a very common thing in Russian after verbs of perception such as видеть, смотреть, слышать, наблюдать.

Russian can use the present tense in a subordinate clause to show an action as if it is unfolding before the observer’s eyes:

• смотрели, как дельфин выпрыгивает из воды = literally something like watched how the dolphin is jumping out of the water

In natural English, we would usually translate it as:

• watched the dolphin jump out of the water
• watched as the dolphin jumped out of the water
• watched the dolphin jumping out of the water

So the Russian present here is not a mistake. It gives a vivid, scene-in-progress feeling.

Yes, but the meaning would shift a bit.

• как дельфин выпрыгивает
  Focuses on the action as it is seen unfolding; vivid, immediate.

• как дельфин выпрыгнул
  Focuses on one completed jump: they watched how the dolphin jumped out once.

• как дельфин выпрыгивал
  Suggests repeated or process-like action in the past: they watched how the dolphin was jumping out / kept jumping out.

So выпрыгивает is a good choice if the speaker wants to present the scene vividly, almost as if we are watching it happen.

Grammatically, yes, как literally means how, but in sentences like this it often works more like how / as after verbs of perception.

So:

• смотрели, как дельфин выпрыгивает из воды

is not really asking how in a question sense. It means:

• watched how the dolphin jumps out of the water
• more naturally in English: watched as the dolphin jumped out of the water

This pattern is very common:

• Я видел, как он вошёл. = I saw him come in.
• Мы слышали, как дети смеялись. = We heard the children laughing.

Because the preposition из requires the genitive case and means out of / from inside.

• вода = water
• genitive singular: воды

So:

• из воды = out of the water

This is standard Russian case usage:

• из дома = out of the house
• из машины = out of the car
• из моря = out of the sea

In this sentence:

• дельфин выпрыгивает из воды = the dolphin jumps out of the water

Yes, Russian word order is flexible, but this order is very natural because it clearly sets up a contrast in time:

• Сначала = at first
• но потом = but then / but afterwards

So the sentence is structured like this:

1. first reaction: the children got scared
2. later reaction: they watched for a long time

The но adds contrast:

• first fear
• then curiosity or interest

You could move some words around in Russian, but the given order is neutral and clear. For example, долго could be moved for emphasis, but потом долго смотрели sounds very natural.

Not exactly. Плыть means to swim / to float / to be moving through water, but подплыть adds the idea of approaching something.

So:

• плыть = to swim
• подплыть = to swim up to / come closer by swimming

That prefix под- often gives the idea of moving up to something.

So:

• медуза подплывёт ближе is not just the jellyfish will swim but specifically the jellyfish will come closer / swim nearer

Because in Russian, subordinate clauses are normally separated by commas.

Here there are two subordinate clauses:

1. что медуза подплывёт ближе
2. как дельфин выпрыгивает из воды

So Russian writes:

• дети испугались, что...
• смотрели, как...

This is standard punctuation in Russian, even where English might sometimes be less strict or structure the sentence differently.