It could be that the entire 2nd half of Shutter Island was Teddy having a terrible nightmare.
More Specifically, everything after he is having a Migraine episode and is laid to sleep on the bed near the end of the 1st hour.
Why would I think that? First, the fact that the movie is set in a mental asylum means that there will be some mindf***ery going on in it. Now, please take a look at everything that happens before that spot. Other than Teddy's flashbacks and nightmares, which all clearly happen in his dreams AND the dreams are taking place at their logical place (burning wife at their home, the war in Germany), is there anything that happens that can be classified as "supernatural" or "hallucinogenic" or "mixing reality and imagination"? no. there is obviously something shady going on with the doctors refusing to release the papers and what not, and many things were suspicious, but there is nothing hallucinatory that you can spot 1. Also, Teddy wasn't having a lick of luck or success in anything pretty much.
Then, Teddy is having a severe migraine and is laid out to sleep. He is also tired, angry, and can't stop thinking about what is going on in this place. We see the storm lights strongly on his face multiple times as he is going to sleep.
After that, what do we get? the first instance of a dream taking place at his current location, with him meeting his wife there.
and after that? well, for some reason the patients randomly decided to escape the place that very day, managed to cut the power, yet despite their number weren't able to overwhelm the staff and are handily being brought back AND no one was murdered or even stabbed anywhere we can see.
Awfully convenient isn't it? yesterday everything was going against him and all of a sudden today was going for him?
Now I know that that part is answered by the "main expected narrative", but here is a question: the people in these wards are insane right? that is a fact, they are bonkers and dangerous killers right? then why and how would 66 insane people understand the doctor's complicated plan and fully cooperate? further more, how could said insane people be trusted to be let amok for a bit like we saw, or to be let free in anyway for any length, when they are clearly dangerous people and most of them, as the doctor himself said, had killed somebody?
How about that inmate in the most dangerous section that Jumped Teddy, had him in a chokehold, and started rambling about the Nukes? you think he could be trusted not to snap teddy's neck? or the bunch that tried to grab him in the cells?
Let us move forward to finding "Chuck's body". There was no way off that area the body was in other than climbing the cliff, the one cave, and the clearly agitated sea who was clearly hitting the rock every couple of seconds. If we are to believe the main narrative then Chuck put his cigarette (still lit, meaning it was only put there a really short while ago), found time to climb down the really dangerous cliff (or went there on a boat that Ted neither saw nor heard the sound of its engine somehow) and laid there for Teddy to see him. I suppose in this part it could be argued that someone was watching Teddy via telescope and put the cigarette there then hid while Chuck was already down there for a while, but that wouldn't make sense because of the strong waves that were hitting the rock. He wouldn't have lasted on that rock until Ted arrived. Furthermore, how did he escape during Teddy's descent? also, how much of a coincidence (again) is it that the paper he had randomly came right next to Ted's hand? because surely they couldn't have manipulated that.
Now Ted finds the scientist and talks to her and she tells him of what happens, then we see a sudden cut from him talking with her to him sleeping (btw, sudden cuts where the characters suddenly change their position/facial expression/etc happen a lot in this movie, to the degree that it feels intentional and purposeful). What happens while he is sleeping? the storm light comes on his face, in a shot that is pretty much the same as when he went to sleep. yet when he "wakes up" the storm is over. I believe that shot with the storm light could have been a hint about him still dreaming in that room.
furthermore,if the "expected narrative" is true, then, in addition to the parts i mentioned:
-why did the inmate secretly write him to run away? it makes no sense if she knows who he really is and what they are doing with him to write that.
-why did "Rachel" claim that he was her husband,hug him and not say anything, then say " you are not my husband because i killed my husband"? what was the purpose of that whole segment? to position her as the female version of him for some reason?
-why did his "psychiatrist" say that this whole thing is too much of a coincidence and that it is obviously a ploy to get him into the island to kill him because he investigated too much? That is reinforcing his "delusions", which is the exact opposite of their goal.
-What happened prior to the start of the film? did they drug him, wake him up with some actors, and say that he got the assignment? he supposedly believed that for 2 years, and this is the 1st time they have done this experiment, and he "reset" 9 months ago, so how come he has no memories of the past 9 months and instead remembers his normal life before all this?
-most importantly, why did him going to sleep from the migraine become the clear line between "plausible world where some big shots have something to hide" and " a world where implausible hallucinations and incredible coincidences are working together"?
I know that people generally the hate "It was all a dream!!" endings, and with this interpretation we get the "Mass Effect 3 Indoctrination Theory" problem of the movie not having a real ending according to it (Ted is still sleeping in that room after all), and like I said i don't claim at all that this is necessarily what happened or what the director had in mind, but it is a theory that made sense to me and I didn't see anyone else suggesting it, and would very much welcome any respectful discussions/thoughts/etc about it :).
Other than that one shot of the woman drinking nothing, but in the shot before that Chuck clearly brought her a cup full of water, and that cup was empty in the next shot, so that could be explained by "woman is insane and drank the cup then drank another imaginary one" or something.
-Teddy is/was a US Martial. all 3 theories agree on that. Here is a question, do you really think a US Martial, no matter his current mental state, would think that a toy gun that he is holding is a real gun? to the degree that he is saying that he "can tell it is loaded because of the weight"? what US martial in the world, in whatever situation, would make such a mistake that a little child wouldn't? no one, but a lot weirder things can happen in a dream.
-when Teddy is shooting the plastic gun, not only does smoke rise from it, the doctor actually gets bullet wounds and his blood splatters on the board, yet in the next shot all that disappears. very dream like don't you think?
-during that scene the doctor says that, if Teddy had brought proof of the 67th patient to the outside world, he would have "blown the lid off this place". Why? If his story is correct then it is a matter of known public record that there are 67 patients there. So even if this information was brought to the outside it wouldn't matter in the least. remember however that Ted had already arrived to the conclusion that 67=67th patient, and that it is a very important part of solving the mystery, so his brain in his dream is presenting that part as on the same amount of importance as he thought it was before he went to sleep. same thing with this "role of 4", which btw completely ignores that the name he identifies with more and prefers is Ted, not Edwards, so why would his subconcious make an amalgamation of the name that is on his ID but he doesn't really like instead of the one he identifies with, likes, and asks people to call him? I have a similar 2 name situation, and that part was very weird to me.
-Why did the patient in the beginning make him a "remain silent" move? if she knows who he really is and what they are doing with him then what was the point or meaning of that gesture and how does it help him?
-After he reaches the road the warden car is already on that particular part of the road and picks him up (an additional extremely convenient coincidence), and then they have a conversation. please take a look at that conversation again. Do you really imagine a warden of a respectable institute saying that vicious and really cruel stuff randomly in the car? let alone to someone who is either a patient they are sparing no expense to heal or a US Martial? That entire conversation seems simply implausible to me under those conditions. Remember what Ted said about him right before he went to sleep though? "He looks like a military prick". Isn't that conversation what a "military prick" would say? Just taken to extremes,as the mind usually does in dreams?
-What did the german doctor intend to do to Ted with the syringe? If he went to sleep then the whole supposed "treatment plan" would have been over.
Honestly, while i certainly still don't claim at all that this is necessarily what happened or what the director had in mind, at this point I feel there are enough evidences and clues to make this theory as valid as the other 3 ending theories