movie theater scene

Okay so what movies was the scene they were watching in the movie theater. Because i thought all those scenes of when they were young were just flashbacks to tell us what happened...but then its on the wall playing through the projector...so does that mean their flashbacks are a real movie? i don't get it. is that another movie they're working on besides the circus one or something? acually...that couldnt be possible...so hows it possible their past is playing on a projector?