Haha. I thought her reaction fantastic- her perspective is so far skewed from reality, she seems so very random to the majority of the bar's patrons who understand what the bar is. From her point of view (the one in which she believes the Bar to be a very poorly-made and possibly sadistic "scape" in which all of our characters are Paladinian actors), her reaction makes sense. "Mauselea," which Al mentioned, exists outside of the universe in which the scape she believes she's in takes place- hence her thoughts about Al's "breaking the fourth wall," and her increasingly negative opinion of his "performance," which she views as flagrantly incompetent. Add to that the fact that she's already freaked out by the fact that Al doesn't seem to be alive to her shape-changing blood-sense thing, and her reaction, I think, is right in character- though, yeah, Al's just going to be confused.
Amber could probably explain better than I.
As ever, Katrina, well written ^_^