I once spent a month living at a friends house in Lam Tsuen and that was about 4 years after this film was made. A recent visit confirmed to me how much redevelopment has gone on here. The clear view you can see in the film is rare given the number of village houses that have sprung up through the numerous villages that sit inside the valley. However, look carefully and you see Kwun Yam Shan in the background of the second screen grab.
Neil worked as the location manager on this film so I'm sure he might be able to recall the exact spot where the filming occurred, but in the meantime I'm going to make a stab at the location as somewhere around the back of Kau Liu Ha (very near to the Lam Kam Road Interchange) near Ngau Kwu Leng Lane.
Here's a reasonable match on the area courtesy of Streetview taken from the Ngau Kwu Leng Lane bridge.