I watched Mulholland Drive for a second time the other day and, of course, couldn't help but think about all the stuff that had been discussed here (the "explanation" the thread title offers).
When I began to think of it in terms of the ideas that had been given out here, the movie suddenly seemed so simple - and became much more moving than before (I had previously appreciated much more on a mood, atmosphere, imagery level rather than a plot one). The thing is: it almost felt too simple. The beauty for me of a lot of Lynch is that you have to work it out for yourself and make your own interpretation (as has been so consistently argued, sometimes angrily, here...), and when the plot just suddenly came together this time, it was almost like a disappointment. I'm not sure exactly why: I think I need to watch it one more time to make up my mind again fully.
The ending this time really got me emotionally though - as you say, Godardian, the final superimposition is such a beautiful, moving thing when seen in context (previously I had a vague feeling about its significance, but this time it spoke to me more clearly). However, the movie was reduced a little for me to have it sorted out in my mind: it just became a story told in an interesting way (like Egoyan might, do for example - x10 for Lynch, of course), rather than something more illusiory and interesting. I really don't know why it should disappoint me that it became a story that made sense to me, but somehow it did.
I dunno. I'm really not sure of my final opinon. One more watch is needed. I may in fact prefer it to Lost Highway after all (even though I really enjoy the fact that LH, despite an "explanation" in this thread, doesn't come together for me in a way that makes total narrative sense - but more philisophical sense...). It certainly made me feel more this time.
However: I still stand by the silliness of the little old couple. Even though they are fucking freaky too, they make me want to giggle, which is unfortunate.