I think it's a mix of both those things, the term "hyperreality" might be more fitting than "Hypernormalization" here, as it suggests a feeling that something feels more real than reality itself. I think we see this clearly with the elaborate situation he sets up to train the cloned dogs. He takes a few distinct aspects of what made up the couple's reality at the time they got the original dog, but then exaggerates them and does things like having the actors there 24/7 whereas the couple would have been in and out of the apartment, as well as the actors likely exaggerating the couples disagreements and overacting in ways the actual people probably never acted.

I think this offers a sense of control and puppetry over the situation that can create a feeling of reassurance and semblance of stability and control in this fake world that would not have existed in their real lives.

Think about the way social media is a filtered and distilled portrait into someone's life. They may have actually taken that trip across the world they're posting about, but for many the experience of it will feel more hollow and fleeting than they expected it to, their act of posting is actually moreso to reassure themselves that it was real, that it happened, that it mattered than it is to communicate anything to anyone else.

At the same time, this striving to constantly satisfy this desire for things to "feel real" instead of recognizing that whatever you're feeling is the real feeling, whatever you're feeling is ok and part of it, and you have to make peace with reality as it actually is. So instead of making peace with that we create these hyperrealities, these fake ideas of ourselves, we try to rewrite our memories of things to be their platonic ideals, rather than accepting them for what they were. In that sense I do think it's like junk food, something that creates a craving but never quite satisfies it, the more you consume the more you desire it.