The madness of the Trojans is what Virgil emphasises the most throughout the whole passage, he says they were "blinded by madness", even Laocoon could not dissuade them. Virgil wants to emphasise the stupidity of the Trojans, in this 'madness', and he does this in a few ways, one of these few ways being Laocoon. The many events that prove Laocoon's true words add to the whole effect. Aeneas says, "the gods were against" them, so that half justifies the stupidity of the race eventually to become the Romans.
The story provides a whole lot of reasons for why Laocoon is not believed. Virgil did not want to offend his own race - the Romans, but he needed the horse to be brought in, so these reasons justify everything.
The first reason I have already mentioned - the gods were against them. It was the fate of Troy to fall by the Trojan Horse, supposedly, so there was nothing anyone could do to stop it. This is the base for all other reasons, as the 'Gods' were very important, this reason alone may have been enough for some.
The second reason is also a very good one. A man called Sinon - sent by the "evil and cunning" Greeks, but unbeknown to the Trojans, allows himself to be captured. He tells a very convincing and very untrue story which makes the Trojans further believe in bringing the horse into the city, and gets him out of being killed by them. He says basically that since a sacrifice had to be made to get to Troy, a sacrifice - Sinon - had to be made to get back - this is part of the trick to make the Trojans think the Greeks have left. Sinon says he got away, and here he is. The Trojans feel sorry for him and now believe his further words because of it. He says the Trojan Horse was to appease the goddess Athena after they angered her. It is its size to stop the Trojans bringing it into their city and thereby gaining its protection. They believe it all blindly.
There is one final reason that makes sense, both to the reader and the Trojans, and it confirms the first reason. Laocoon - the one who has been against the Horse, which the Trojans think a holy gift to Athena - is on the beach, making a sacrifice to Neptune, when suddenly two huge serpents come across the water at him. Neptune is with the Greeks, so he could have sent them to fool the Trojans into what they were about to think. Alternatively, from the Trojans point of view, these serpents are punishing Laocoon for being against this holy gift.
The serpents come up to Laocoon and first they take his children, and bite off their limbs. Virgil's use of the phrase "poor child" adds to this. It shows pity for the poor defenceless child, making what the serpents do more horrific - further showing the gods have no respect left for Laocoon - or so the Trojans think - which is why they have sent this punishment. Secondly, the serpents take Laocoon and coil tightly around him. They move with him up to the Temple of Athena within the city walls, and at Athena's Statue, vanished under her shield. A holy sign to the Trojans, but a successful trick by the Gods that favour the Greeks.
Because of the now changed viewpoint of the Trojans, they are almost afraid to not bring the horse in.
Before Laocoon met his sad demise, he tried to prove his words with deeds. He, when he first came rushing down from the Citadel, threw a spear at the Wooden Horse. When it hit, the sound of the horse being hollow was heard, but the Trojans take no notice, again, they are "blinded by madness". Also, when they are dragging it through the walls, the 'chink' of armour is heard inside, again, the Trojans take no notice.
The feelings and reactions of the Trojans change a lot throughout the passage. At the beginning, they "were split into two camps", as I mentioned before, "undecided which course of action to support". As Sinon relates his lies, they are slowly turning more to believing the lies and wanting to drag the horse in. Laocoon, of course, is always there, blaring out the truth, that they will not listen to. When Laocoon is finally killed by the serpents, they are all a 'single camp', and all want to drag the horse in. Once it is in, believing Sinon's story and that Athena protects them, they are joyful and celebrate. Night falls, and they are drunk from their celebrations, and now Laocoon is proved right, and they meet what they deserved for not believing him.
The Greeks creep out of the horse, and go around, killing the sentries and any Trojan they see. The rest of the Greek army is allowed back in, and Troy falls.