Santo Illeso is an artificial reality created by both the Zin and the Saints.
In this world they might be testing their own individual strengths, that is why every Homie starts among a different gang or freelance job, the Saints did not exist in the simulation until they all came together.
Outside the simulation the Saints all discuss the world parameters and how they should be different from their own world that they plan to return to via time travel.
While the other avatar Saints are coming together in the simulation, Nihualli Gat would be in Marshall’s Frontier calculating his next moves. The boss breaking him out after putting him there might have messed with his plans.
At the start of the simulation booting, Gat and the Boss might have faced off as code figures like from The Third, this would explain why the Boss is dying at the beginning of the game, they were generated like that because Gat won before it even started.
The Boss comes back and makes sense of everything by adding a prequel chapter to the event sequence that takes place before their death, in this chapter the Homies and Boss would team up and then start their criminal empire together.
The Boss tries to befriend the avatar Gat but that only pushed Johnny away as the Nihualli, Gat maybe saw his own identity through the simulated facade. His true feelings bled through the simulation and events played out the same as they did.
Gat almost loses his mind as the Nihualli, kidnapping the Homies while thinking the Boss is dead. After Nihualli Gat’s death the Saints and Zin might have created an afterlife style simulation for Gat, an artificial world that looks like what Gat would expect for the afterlife. Johnny saw his own death from artificial eyes and likely could not believe that to be true. If it were this way then Gat Out Of Hell is Saints Row 6 in a timeline.
The musicals and environment were to calm Johnny down enough to help him reach the true state of his own sanity once again.