Everyone on the show was dead the whole time, except for the flashbacks to their lives before the plane crash. The characters from Oceanic 815 died in the plane crash. Everyone else on the island is someone else who died some other way. (like Jack's father, who died just before Jack) We know that Jack died knowing his father was dead, and expecting to bring his body back, therefore he must have died in the plane crash bringing him back. The plane was shown at the bottom of the ocean. This was literally Flight 815,not a fake by Charles Whitmore(a ridiculous premise). The island is a place to "move on", or find redemption. When Jack opened his eyes in the pilot episode, he had just died. When he closed his eyes in the finale, he had found redemption, and moved on to the final stage of moving on, what we called the "flash-sideways".