Finally saw this, have watched it several times now. Hilarious, touching at times.
Regarding the last half-second view of Billy singing, "a thing," my take is that the story is real - as Whedon has implied, with the plans for a sequel. Were that not the case, however, I would argue that the last sequence with the party and the Evil League of Evil was imaginary. Penny's death has caused Billy to stop being a super-villain - thus the absence of flashing gizmos and bright lights. He's talking a good show, telling his blog watchers about his plans, but he can't bring himself to put any real effort into the production.
"Bad Horse, Bad Horse, Bad Horse, Bad Horse, he rides across the nation, the thoroughbred of sin, he read the application that you just sent in!"
BWAHAHAHAHAHAHA!
On a different note, I just went to lyricsmania to read some of the Dr. H lyrics. The "top searches" list was headed by The Fray. (Little Whedon joke there.)
