The Dude figures out that he was used by the "other" Lebowski for many reasons: his wife took a long trip without telling him and so he wanted to get rid of her, and by using a fake suitcase and deal, could get the Dude killed too so they'd both be out of Lebowski's hair. The painted toe was from one of the assassins. Donnie dies of a heart attack while The Dude and Walter are fighting in the parking lot of the Bowling Alley with the assassins, who've come to collect the money. They spread Donnie's ashes at the beach and then go bowling....in the words of the Dude,"The Dude abides..."
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