The audience of a cinematic movie always knows that the movie is not real,
i.e. that at the end of the day they are sitting in a movie theatre with lots
of other people looking at pictures projected on a screen and listening to
sound coming out of loudspeakers. It is of course part of the movie-maker's
craft to do everything possible to make the audience live the movie as if
it was a real experience.
An awake cinema audience with mental faculties fully operational does generally require a coherent plot, although a certain amount of fantasy is permitted in some types of movie.
And finally, the makers of a movie would be very disappointed if most of the audience completely forgot that they had ever seen the movie the moment they left the theatre.