I once thought that video games were just billions of pictures, like, screenshots I guess you could say, and when the game crashed it was because the devs forgot to put a picture somewhere.
I used to think that what was happening in a game, somewhere, what I was doing was happening in real life.
(The only things I played very much back then were BF2, Midtown Madness 2, and Rollercoaster Tycoon, so it was at least kind-of reasonable.)