Spoilers!
IT was hinting to the protagonist that what they were experiencing wasn't real. While ITs having fun messing with you, IT also wants you to wake up so IT can properly absorb you. The more you continue to daydream though, the more fun IT has, the more IT desires you -- IT kind of also gets stuck in a loop there!
When the victims use endDream.exe, they were using something familiar to the protagonist to share their strength and disconnect you from IT.
Little is shown about the protagonist's day to day life for the purpose of the game but their personality and interests are meant to be hinted at via the daydreams that IT then corrupts. That you get endings like the Fatal Error ending is meant to show that the protagonist is familiar with computers and maybe programming -- though I'm not sure if I conveyed that very well since it's just supposed to be more of a background thing!
Hope that helps!