Above left: The hairy-armed man gets the "girl is still missing" message from another man who talked to Mr. Roque, then he calls Diane's number. Above right: The phone then rings at Diane's place. When I said in part 6 that this is the same moment in time as that at which Diane believes Camilla's calling her, I was wrong: there are actually two separate calls. The first, chronologically speaking, is when Camilla actually does call Diane to tell her to go to 6980 Mulholland Drive. The second call (again, chronologically), which is the one from the man with the yellow phone, has as its purpose to let Diane know to go ahead and go to the audition Adam is staging, so that she can get the role that she believed (prior to the hit) was going to go to Camilla. The point is, the reason Diane wanted Camilla dead was so that she could get the role in Adam's movie. The fact that there are quite a few cigarettes in the ash tray by the phone, and that they look like the kind the hit man smokes (brown filters, as opposed to Adam's white filters), suggests that there has been some kind of relationship going on between himself and Diane. In fact, they probably had already discussed the possibility of a hit prior to the Winkie's meeting, and even prior to Diane getting the call from Camilla to go to Mulholland. After the hairy-armed man is done talking to Diane, she must think that Camilla is dead.
Above left: Later in the movie, Diane has a dream that she is escorted to the set of The Sylvia North Story by some people in the entertainment business. The reality is that she got a call from the man with the yellow phone, as described above, and then later showed up on Adam's set.
Above right: Adam looks over and sees Betty (Diane). He is in the process of staging auditions for his movie, and Betty (again, Diane) hopes he will let her audition. (In reality, 'Adam' is the romanticized version of Bob Brooker, as explained below.)
Above left: That this blond woman is shown auditioning under the name 'Camilla Rhodes' in Diane's dream, and that Roque and others performed behind-the-scenes manipulations to make sure this girl got the part, are Diane's 'dream-substitutes' for the fact that she had hoped (the real) Camilla wouldn't show up for her audition due to her already being dead, but that the hit was bungled, and (the real) Camilla did go on to get the role. What must have happened was that the hit man kidnapped Camilla, but then she escaped before he could kill her. In fact, this is what is being represented in Diane's dream of the accident and 'Rita's' escape - Diane's knowledge that Camilla somehow escaped the hit man's clutches.
Above right: The blue-haired woman says, "Silencio" ('silence') at the end of the movie. This indicates that now that Diane's dead, she's no longer haunted by the 'voices' from her past, such as those of her abusive parents.
Taking all of the above together with the rest of this analysis, we see that the reality of the movie is that Diane Selwyn was a call-girl on the mend, trying to stop drinking but suffering severe alcohol withdrawal symptoms. She saved up enough money from working (money which was later dreamt of as having come from a small inheritance from a relative), so that she could have her some-time friend and love-interest, Camilla Rhodes, killed in order to get a role in a movie; but, the attempt failed. Another reason Diane wanted Camilla dead was because she believed that Camilla had, at various times, been condescending toward her, such as at the party. She also believed Camilla was taunting her, as evidenced by her flashbacks of Camilla and Adam kissing at the party and while on Adam's set.
Diane got the idea for being 'Betty' in her subsequent dream-life, from having seen the waitress's name tag while conversing with the hit man at the diner. (Diane's borrowing of someone else's name is what is being represented in her dream, of Rita getting the idea for her own name from a movie poster.) When Diane later (chronologically) sees a tag with her own real name on it, in her dream of being at Winkie's with Rita, this is an indication that she may have actually worked as a waitress or other food service worker at some point or another. Perhaps she worked at the Pink's hot dog eatery that the prostitute, hit man, and pimp were shown exiting.
Some of the people Diane saw at the Mulholland Drive party, as well as what she believed she saw happen there, became the source for much of her later dream-life as Betty: Adam's mother became the landlady for Havenhurst; another woman she saw there became the Camilla Rhodes 'double'; a man she saw in a cowboy hat became the mysterious cowboy of the dream; another man became one of the Castigliane brothers (the man drinking espresso). The pool-man who slugged Adam came from Adam saying at the party (of his recent divorce), "I got the pool, and she got the pool-man". All the bad things that happen to Adam in the dream, such as his wife cheating on him, his picture getting shut down, the fact that people are looking for him, and his credit going bad, are Diane's dream-revenge for his not having given her the role she desired. Diane's 'idea' for her lesbian fantasies must have had its source in seeing the blond woman kiss Camilla, though in all likelihood it was just a peck on the cheek from a friend, not the 'romantic' kiss that Diane believed she saw.
Diane's dream of Adam's encounter with the cowboy lets us know that her own subconscious is attempting to 'speak' directly to her in her dream; that's why the cowboy speaks very frankly, and is so particular about getting Adam to listen - it's really an attempt by Diane's subconscious to get her own attention. Accordingly, when the cowboy tells Adam that he will have done good if he sees the cowboy one more time, but that he will have done badly if he sees him twice more, it's really Diane's subconscious saying this to herself. Later, it turns out that she 'sees' the cowboy twice more in her dream: The first time is when the cowboy knocks on her door and says it's time to wake up, and we see Diane's sleeping body in its normal physical state; the second time is immediately after this, when the cowboy is shown standing in the bedroom doorway looking at Diane's partially decomposed body (the two scenes are separated by a fade-to-black).
Ultimately, the man known as 'Adam' in Diane's dreams, and in her flashback to her experience of the Mulholland Drive party, is a 'romanticized' version of the real director of The Sylvia North Story, Bob Brooker. Recall that Diane mentioned at the party that she didn't get a role in the movie due to Brooker preferring Camilla instead. One might think that Adam can't be a representation of Brooker due to the fact that at the party, Diane mentions Brooker's name in the presence of Adam. However, one must realize that Diane's flashback of the party only partially depicts actual reality. Speaking generally, the sources for Diane's dreams and flashbacks consist of both actual reality and hallucinatory and fantasy-based experiences. In fact, the actual movie Diane hoped to appear in was in all likelihood not even a mainstream movie - she only dreamt that this was the case later.
Furthermore, the way Bob Brooker himself was depicted in Diane's dream of auditioning for his movie, was probably some 'idealization' of him created by Diane's subconscious as she dreamt. One of the main purposes of the scene with Betty's (Diane's) audition for Brooker is to convey to us the fact that Diane had, at some point early in her life, experienced sexual abuse from a friend of her father.
Diane's knowledge that the hit man (Joe) is a bungler is represented in her dream by his escapades in another man's office (killing three people, shooting the vacuum cleaner, etc.) The accident discussed by him and the long-haired man (and apparently first brought up by the latter) must represent some auto accident that he (Joe) and Diane both have knowledge of; but, it must not be one in which Camilla escapes from Joe, for a couple of reasons. One is that Joe delivers the blue key to Diane (or perhaps more likely, he leaves it some place where Diane can pick it up, such as behind Winkie's), so he thinks he has her fooled into believing that Camilla has been killed, and therefore he wouldn't have told her about such an accident. The other is that he retrieves the black book from the long-haired man in the dream, and he wouldn't need the book if the hit had already been attempted, since the book itself was probably to be used to get information on Camilla, such as her address, in order to carry out the hit. Later in the movie than this dream (but earlier chronologically), Joe is shown with the book at the Winkie's meeting with Diane. The reason he's already in possession of it at this meeting is because, as stated above, he and Diane had already discussed the possibility of doing a hit on Camilla prior to the meeting. [UPDATE 11/15/11: Recall that the long-haired man referred to the black book as, "the history of the world in phone numbers". This might imply that the book contained contact information for influential people in the movie business, and was thus possibly to be used to help Diane get the movie role she was seeking.]
Diane must have encountered someone while staying at the Sierra Bonita apartments, possibly a homeless man or woman, who sensed that something was wrong in her life, and this person became Louise Bonner in the dream, and was also part of the source for the man behind Winkie's. As discussed in part 8 on Wednesday, Dan, the man in Winkie's who said he'd dreamed there was a man behind the restaurant, was in reality Diane's psychotherapist. It was actually Diane herself who had had two dreams of the homeless man. The red-haired woman ('Aunt Ruth') is based on the girl Diane switched apartments with at Sierra Bonita.
Diane's whole dream-fantasy eventually 'collapses', as represented by the collapse of the singer in Club Silencio. In the end, after Diane has awoken and has an encounter with the woman with whom she switched apartments, she is later shown staring at the blue key on the coffee table in her apartment. It is at this point that the realization of all that she's done sets in, and she also realizes she's been a complete failure. The detectives who have been looking for her begin knocking on her door, and she then hallucinates and kills herself.
[UPDATE 10/22/11: Another part of the source for the man behind Winkie's, may have been Diane's idea that there was something or someone out there, some sort of 'monster', who had important knowledge about her past or her psychology, and who thus had some kind of power over her. Apparently, the reality is that her therapist, as represented by the condescending man in the Winkie's dream (Herb), thought it best to try and get her to see that this monster wasn't something that was real, that Diane was not justified in believing it had any kind of control over her. This was represented in the dream by Herb having Dan (who here represents Diane) go out back of Winkie's; then, when it turned out the 'monster' was actually there, and Dan (again, representing Diane) collapsed upon seeing it, this represented her real-life therapist having been wrong about the monster's non-existence, and having made a bad decision in trying to convince Diane that it wasn't really anything to worry about. Of course, the monster ultimately represented something in Diane's psyche, but the point is the psychotherapist was wrong. (As an aside, I can't help but think there's some reason, that Lynch chose someone who looks like an alien to play a psychotherapist.)]
[UPDATE 11/6/2011: The dead and partially decomposed woman's body that Betty and Rita see at Sierra Bonita has blond hair, but it's longer and darker than Diane's/Betty's hair. What I think is going on is that the body is really that of Adam's (ex-)wife, Lorraine (recall the scene in Adam's house, in which he finds her cheating on him.) This actually brings to mind Betty's facial expression when appearing on Adam's set (as shown in the screencap earlier above) - she has an almost 'love at first sight' look on her face when she sees Adam. This would indicate that the real 'love story' of the movie is not one between Betty and Rita (Diane and Camilla), but is instead one between Betty and Adam (i.e., between Diane and Bob Brooker).]
