---Heavy spoilers for people who haven't played it yet---
You could either interpret it as 'the shooting gallery is not real' since it's not actually a western setting with cardboard cutouts, or you could see it as the game telling you that 'the bandits are not real people' by hiding them under the cutout illusion.
And I caught this just before going to bed, but I'll be sure to check out your game when I wake up!