several years later, but I see the conversation is still going on...
Chris himself states that he is in "dream time" (i.e., not earth time) during the last scene. And when David asks where he will go now, he says he will rejoin his people/tribe in dream time.
The entire film takes place in two different dimensions, but only at the end does Chris fully communicate, and in so doing (and giving away the stone), he breaks the law of his people, but also finally frees David's vision.
We can presume, I think, that Chris's physical body is rotting away in prison. But then, Peter Weir, at least at that time, liked his endings open, and all the threads can't be tied up in a neat package. So we aren't really given a key to disentangle where dream time ends and earth time begins.
(There is another thread about the ending, where Burton's final entry into - and acceptance of - dream time is discussed. As far as I can see, these last scenes all take place in what for us is the "other".)
The danger, though, is that we might interpret the whole thing as hallucination. Our "cultured" minds simply don't have the perspective to grasp living in the two worlds at once. So rather than trying to figure it out logically, we just have to let go and realize that we are being taken through a new experience. Like seeing a brand new color, we only corrupt the experience by trying to define it using our previous memories.
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