To create a dream state is to imply that the viewer temporarily loses oneself in that state. The self-reflexive dream state suggests that on another level, viewers watch or reflect upon themselves dreaming, or to put it another way, to be simultaneously very involved and not involved at all.
Turning back to the Monty Python films, as well as the Beatles films, there is in both the acknowledgement by the characters that they are performing as well as participating. Almost ironic in tone, these performances veer wildly from viewing the characters as innocents and then as having enough mastery over the situation, that they step out of the role and address us, the audience, directly.
Whether the technique is Brechtian or closer to Beckett, the device allows for a range of genres—adventure to satire—that helps the MTV-style film transcend what could easily become marginalized to pictures for the music. It reinforces an attitude in its audience—the will to reconfigure their world via their dreams, all the while acknowledging, "Just playing, folks!"
But the self-reflexivity plays another, more serious, role in the MTV style. Because self-reflexivity acknowledges that it is a film being watched (as opposed to reality), this creates a tolerance for ranging more widely. It pulls the film closer to theatre, where the suspension of belief is far higher than in film (which looks real). This freedom allows for shifts in feeling, narrative, fantasy, etc., without needing to make those shifts plausible. It is after all only a film you are watching. "Go with it," is the message to its audience, and knowing that it is a media event (unlike a real dream), the audience is tolerant of those shifts in tone, time, place, etc., that are undertaken.
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