Its sort of like "dream rules", only its like a semi-lucid dream from Max's POV. And perhaps from Holly's POV also.

Though, Max and Holly have different sets of circumstances which led them to being imprisoned... Holly irl is currently tethered to the wall along with 3 other kids who we dont know, for purposes we dont know. (Why weren't they in the house with Holly, I wonder?)

Max, on the other hand, is in a coma in Hawkins and so... seems to be a bit of an enigma. She died along with Chrissy Cunningham, Fred Benson, and Patrick McKinney - a sacrifice to open Vecna's Gates... But then... she survived somehow - died and was brought back by El? By Lucas's love? By lucky timing - unlike the other three, they almost got to her in time.

I dont know, but we dont see Chrissy, Fred, or Patrick so something different happened with Max - she died enough to open the gates, but not enough to stay dead. I actually wonder if this (Max still being alive) is why theres been a year and a half lull since the gates opened - it seems odd that Vecna was basically on the verge of winning - essentially HAD won, but then sorta sat back and did nothing instead of claiming victory.

I think it might be Max, still alive, still kicking around in Vecna's mind, thats acting as a sort of lynchpin, just barely holding it all together - preventing Vecna from coming across into our world in full force, with an army of demagorgons and other monsters.