“Are reality and fantasy mutually exclusive?”
What a really great question! For me to think this through I would first need a 'start point'. I would first need to understand what the two words mean.
REALITY: “The state of things as they are, rather than as they are imagined to be”
FANTASY: “A situation that you enjoy thinking about but are unlikely to happen, or the activity of imagining” Another definition could be, “The forming of mental images, especially wondrous or strange fancies; imaginative conceptualizing.” And then this one, “The power or process of creating especially unrealistic or improbable mental images in response to psychological need”.
So with that in mind, (and for now only that) for me they are exclusive.
If I were then to engage in a kind of mind experiment. Let’s remove the human mind from the equation & separate it from ourselves, if your thoughts allow you to do that? Lock it away in a box & move the box out of sight. We are just left with what’s around us. The realities of the physical universe & how it works. That reality has no place for fantasy -- fantasy does not exist there in its self or by itself. Fantasy is a completely separate entity.
So where does fantasy exist? It exists only in the mind that is locked away in the box – it is separate from the reality around us. And therefore in that sense, exclusive.
If the original question was different, something like, where does fantasy & reality exist together? I would say they can only exist together in people’s minds -- a seperate place from the 'reality' around us. Destroy the mind, destroy humanity, and fantasy then stops existing within the 'reality' around us.
Perhaps some might say there is no reality in people’s minds, only fantasy?
Anyway, that’s my initial thoughts on it, but it’s not as though I’m an expert on this kind of thing, far from it.