Another perspective, this from from John Graley: I think there may be another angle on the film, apart from the VR vs R and religious interpretations. That is the economic movement from a communist or traditional society toward an Americanised society which has taken place in both Poland (fall of global communism) and Japan (move toward industrialisation).
In this interpretation, the sepia sequences outside the game would appear to imply the old way of things (probably exaggerated and stylised to avoid any specific political suggestions – I don’t think this is a political film). The Game Real would be the new western ideal. Possibly the earlier sequences within the game reflect the struggle to improve things: like many computer games it is set in a war, but real wars are only fought because the participants hope for peace afterwards.
Any big change in lifestyle provokes questions of reality in our minds: we can only accept one reality, and must therefore dismiss as unreal either what went before or where one has arrived now. This forces us to interpret any change as being a journey either into or out of the real world.
Ash’s rationale in the first half of the film could be as follows: she takes pleasure only in simple things like making tasty food for her dog, who she loves (hence colour). But her life is still too empty and uninspiring (hence sepia tones). She believes that entering the game and fighting is the only way to improve things, and this is why she does it (she doesn’t enjoy the game, hence more sepia tones).
As the film progresses, she first sees how her society regards those who have escaped (as vegetables). She is also warned of the cost of making a change when her dog disappears (did it go on ahead of her or just vanish? I don’t know). However, the need to progress is within her and it is inevitable that the film will take her to Game Real.
When she gets there, she questions her new reality in the way we all do once we complete a major change in our lives or social cultures. She is given compelling reasons to believe in the reality of the westernised Class Real – reasons that would give the film the “happy ending” that both protagonist and viewer hanker for. But ultimately we find that this utopia is equally virtual to the world she left behind. If you think about it it has to be that way: because every society is nothing but the invention of men.
One might imagine, then, that there are other worlds still, and that to progress from one to another is to progress through the levels of a VR game, perhaps violent, perhaps competitive, perhaps unfair. And that the VR doesn’t really end when the journey is complete. And what happens to the memories of the way things were before – the old life skills and knowledge of a world newly abandoned? Well, we write them off as unreal, kill them, and make them vegetables within our otherwise healthy minds. Or something.