I lean to taking the same approach with Pyro as I do with Soldier, Medic, Demo, or whoever. Maybe they’re batshit and/or on drugs, but if they weren’t also reasonably sensible to their surroundings and the consequences of their actions, they wouldn’t be world-calibre, five million dollar mercenaries. Besides, if Pyro really thought that fire was a happy beam of rainbows and bubbles, why hasn’t he set himself or his team on fire?
So, the dream world is some sort of abstraction. I’m guessing that the way people supposedly feel about rainbows and babies is about how Pyro feels about fire and his enemies. He knows that fire is fire and enemies are enemies, but fire and enemies and fire on enemies makes him all warm and giggly inside.
But I like >>12342 as well. Spy would think that, wouldn’t he? Chronic and sustained cruelty indeed.