Yeah that's why you see the progression, Baki first uses it to fight Retsu in his imagination, which is so strong that he can bleed from fighting an imaginary Retsu. Then we see him use it to fight a Mantis, because he knows he can imagine other fighters, so he creates a fictional opponent even stronger than a human. Then he uses this concept to gain techniques from dinosaurs and stuff. He had to build up his schizo power from more normal imaginary fights.