You know, I believe that the ending sequence is all a dream, and while the evidence is all written down here, I would like to offer something a bit more simple (that does not contradict some of the theories written here).
IIRC (and mind you I learned this stuff about 7 years ago when I thought I would be a psych major, so consider I might be misremembering things from books whose names I've since forgotten), in dreams typically words appear mirrored (backwards) or jumbled, as do colors. 1M1 being backwards, and the color (paragon/renegade) options seeming reversed sort of yell that to me. Not to mention that one of the current hypothesis of why we dream is to make sense of past events, sort of like, sort it in our brains what happened etc... which would make complete sense why so many aspects, from running into the conduit to TIM's Saren Speech, are sort of symmetrical.
Whether you do or don't believe in Freud's Interpretation of Dreams, the idea that dreams are wish-fulfillment is hard to ignore when you consider that 1.) you get to kill TIM (or force him to kill himself) 2.) The boy is alive in some form, the major thing that is clearly haunting shep, and 3.) Shep is given a third option that doesn't royally screw someone over - in the other games there has always been a save [x] and [y] dies (and vice versa) decision. This time, Shep doesn't have to **** anyone over, synthetics and organics can finally live together in peace.
Finally something that hit me over the head recently was that in Interpretations of Dreams, Freud even talks about the "Burning Child" dream. While that dream is completely different from Shep's, of course, it was a funny thing that struck me when thinking about it, I was like "Didn't Freud talk about a burning child dream?".
I also had something about an Oedipal complex, but forgot what I was saying about it so dropped it.
Anyway, dream brought on by Harbinger trying to indoctrinate shep? Maybe, I buy it. But I'm totally reading dream from it.