That’s exactly it. Something, (most likely a miscarriage, but perhaps some other tragedy) has killed the baby either before it was born, or perhaps after it was born, but before the parents could ever dress it.
The cleverness of the story is, as you said, that Hemmingway just gives a basic outline, but yet we know what happens based upon what he doesn’t say. We may not know the specific details, but we know the story. A baby is conceived, plans for its future are made, and then something happens to destroy those plans before they ever take place.
With regards to the page you mentioned, only the 1st six-word sentence is the Hemmingway story. The rest of the story that you see there is another author’s attempt to fill in the story, using only six words in each sentence. The 2nd writer is just attempting to give specific details, but we already know basically what happened, since something has happened to the baby before it could wear its shoes.
There’s a whole genre of writing, alternately called the short short story, flash fiction, microfiction, or sudden fiction, which is generally accepted as being less than 1,000-2,000 words long. The vast majority is between 250 and 1,000 words.
There is a sub-genre of microfiction loosely called ‘word count’, with a wide range of specific names for different types of flash fiction with specific limits, such as the Drabble (exactly 100 words including the title), 55 fiction (you guessed it, exactly 55 words including the title), and more.
Here are a few links to look at if you’re interested.