The trick to understand the movie
It appears to be a progressively convoluted story that eventually makes no sense at all. Then the final scenes are the key that solve the puzzle.
The final event and the first event of the film are related.
More than just a twist ending, this film is a big puzzle. Many details are left ambiguous for the sake of the puzzle. Pay close attention and by deduction and logic it will make sense.
While it may not be 100% flawless Red Belt is truly Genius. One of my all time favorites.
Red Belt reminded me of this story:
http://en.wikipedia.org/wiki/Harishchandra