it was all a fantasy.
The conversation at the end of the film, where the 2 guys were talking about alternate realities and such forth, the film in itself was a fantasy created by Paul in his head, (who is probably locked in a padded room) with Peter being his more human/rational side (or what he has left of it anyway), notice how he belittles and controls Peter all the time? notice he has complete control over the situation with the romote? yeah its all a messed up fantasy dreamt up by Paul.
I taught you everything you know, but not everything I know.