The top starts to fall. Actually seeing it fall is irrelevant. By the rules of the story, the top falling means the scene is real. If the rules the movie spent so much time on are pointless, so is the movie.
I don't think the rules were fully explored. The idea of the totem was that it was a "tell" on subconscious belief; the subconscious always knew if things were a dream or not. However, what happens when you accept something so fully that even your subconscious is fooled?
People can crack; they can go insane and throw all rules of subconscious thought out the window. I think the top was giving up and falling because he was also falling and giving up (our last "real" sight of him being the murder of his shadow wife - an act that could have finally pushed him over the edge).