I believe that both the OT and the FST are real. In the FST the MIB has successfully left the island and went "home." What we are seeing are the granted wishes of those who helped the MIB achieve his goal. But there is a catch. Sayib wanted to see Nadia. He does but
she is out reach to him. Jack secretly wanted to be a father and a better father than his father was to him. Jack got his wish but his son doesn't like Jack either. Kate wants
to be innocent. She says she is but she is still on the run. Hurley can enjoy his money but he can't be a carefree slacker anymore. He has responsibilities now. Sun and Jin want to run away to America but find themselves in a bad situation they can't get out of. So basically they are in Hell. That was the bargain they made with the MIB. The OT is what they have to go through to set things right. (Much like the MIB telling Jacob "You don't know what i went through to get here.) If they don't go through this process, this "test of faith", as Widmore suggests,then the OT will cease to exist and many people
they know and love will not meet, will not be born, etc. This is my theory. So far.