Alive or dead? Real or Ghosts? The Main Question of the LOST series finale.

According to Christian's explanation at the end, everything on island was real. They lived, some died, some left, and some chose to stay. The island was the most important thing in their lives so when they died their spirits were waiting for each other in order to move on. They needed to resolve what was keeping them in a sort of limbo between both worlds and in order to do that they needed each other.

That was the sole purpose of the flashsideways. We were seeing a world they created in order to find each other after they died. A sort of meet up point. But much like 'The Sixth Sense' they had no conscious recollection of their former lives, apart from a feeling of deja vu. Until Desmond came along.

What happened to Desmond was that the electromagnetism allowed him to see into his own afterlife for brief period of time while still being alive. This was the reason for his total personality change directly after his exposure. To him what happened on island no longer mattered because he knew there was a better place regardless of what happened on island.

They are dead dude

The flashsideways is like their afterlife where they need to remember their previous life on the island and after they left it in some cases to move on to whatever is next.

everything that happened on the island was real and they were alive. the sideways world (or limbo) was when they were dead, ghosts. and they needed to remember their real life in order for all of them to move on together