ive watched it a couple of times and have been reassured by numerous serious fans that its not entirely supposed to make sense
there are two interpretations, neither of which has a specific conclusion
one idea is that he is genuinely experiencing the things that happen in the film and the other is that they are all figments of his imagination and that he's a fucked up kid who just ends up killing himself
of course thats going to spark a chorus of "yeh but what about the bit...?"
but apparently thats the whole point
bits dont make sense and dont tie up but thats what the director intended
its quite japanese in its style, in that it expects the audience to draw their own conclusions to an extent and to accept that it doenst all tie together in a nice hollywood fashion
yeah but what about the....oh, right. ok.