Factual error: The damage done by the hobgoblin-induced fantasies is real, as seen several times in the movie. Kyle's car runs off a cliff, Nick's grenades really explode, etc. Nick is in one scene set ablaze by throwing himself on a grenade, and is completely engulfed in flames from his head to his toes. But he shows up in the last scene with nothing but a few minor burns on his forearms and a pair of crutches (that he immediately discards). His hair and eyelashes are not even singed.
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