What really happened (spoilers)

I don't think anything we see in this film is supposed to be part of the story's reality. What we do know is that some years prior, some people were murdered at a school. That's why it's a return to Horror High(not related to another movie also called Horror High).

The killer was not caught.

After viewing this again for the first time in 10 years, third viewing overall, I think the writer is just making up a script. This movie tries hard to be different(which it is) and smart(which it mildly achieves), and the final version is somewhat tepid.

The only people who died in this movie, besides the audience(can you believe this was in the theaters?), were the people who died in the original massacre--and we don't see any of that.

This plays out more like a horror version of Spinal Tap. You have a struggling horror writer who, sick of the same old crap, begins writing a script that is based on real events, but is not only self-referencing, it is a personal fantasy for the writer. He wrote himself into it, like in the movie Adaptation. He gets to show his frustration dealing with a director who wants to add flair to a cheesy script, he gets frustrated with a producer who wants blood and boobs at every turn because that is what sells. A script writer would encounter much of what is shown here, with special effects being ruined due to accidents with timing(the head in the cabinet), constant daily re-writes so that even the cast doesn't know what lines they'll be delivering that day, constant bickering between a money hungry producer and an up'n'coming director who wants to add his own personal flair to the project, and a revolving cast who come and go due to arguments or other obligations.

I guarantee that Clooney's presence is all an in-joke. He basically has a walk-on cameo, and then he's supposed to go do a tv show(in "real life") which would have been Facts of Life. And this certainly happens all the time. You've got movie stars who do a tv show cameo role now and then between films, and they are probably arrogant and annoying, thinking, look at these losers, I'm a star! And vice-versa, I'm going to be on a tv series after this, so let's hurry up and do my scene so I can get the hell out of here.

The writer, tired of being dumped on, decides to write a movie where all the people he hates on his job get killed. But, only metaphorically, considering the ending where everyone gets up from the parking lot and leaves. Also noteworthy, is the "found footage" reference at the end. The crew died, but the movie survived!--or something like that. That's interesting because the only found footage movie made before this would have been Cannibal Holocaust, and considering the nature of that movie and how often it was banned or pulled from rental shelves, most people wouldn't know that film. Considering this is the director's first film, he might not have seen CH either.

And, even though the cops in this are bumbling, there is not way in hell anyone can be expected to believe none of those cops realized those people weren't dead or that the limbs they handled were props. However, life does occasionally imitate art and there was a story a few years ago about a person who found some limbs in a dumpster and called police, only for them to pull the limbs out and find they were leftover effects from a local movie shoot. And they didn't have to send those parts to the medical examiner to find that out!

I think the scene at the end is also not "real." He's thought out his entire script(which is everything we've seen up to that point) and after he types the title, he's so overjoyed with how smart he thinks he is that he might even get a sequel, then "Dad" shows up to drip blood on the page, indicating even the craziest schlock can get a sequel.