Okay the one thing I'm sure of: the flashsideways characters are the same people as the normal reality characters. The FS's must be in the future (their own future). But the world around them isn't necessarily real.
I wouldn't put it past the writers to create some kind of virtual or "test" world for the characters, to trap them in and see how their lives would play out if the crash hadn't occurred. It could also be a purgatory-style supernatural test as opposed to a scientific one (the characters are all asleep in VR machines or whatnot). The year appears to be 2004 because that's part of the faked reality.
The purpose is to see which of the final candidates should win the prize. Everyone is involved since the characters all interact.