Everyone has their 2 cents worth of ideas about Lost and how the ending was explained, so I’m chiming in too. At first I was disappointed by the ending in the final episode. But now that I've had some time to think about it (I know I'm a nerd for allowing such useless information to occupy my brain space). I've got a pretty good theory about what the alternative timeline was all about. Every theory that I've read so far discredits the alternate timeline as important in the overall story. I think it has a purpose.
It all starts with the nuclear explosion at the end of season 5. The "survivors" (Jack, Kate, Sawyer, Hurley, Daniel, etc) traveled backwards in time to the ‘70’s era and set off a nuclear bomb which destroyed the Island. Remember the Island sitting on the bottom of the ocean afterwards? Never mind that the Island was back to normal at the start of season 6 (I'll explain that later). By destroying the Island the space time continuum was badly disrupted. The Island was destroyed before any of the survivors ever boarded Oceanic 815 - in fact before some of them were even born. Events that led up to them crashing on the Island were forever changed. For example Ben's father, a member of the Dharma initiative, never went to the Island and never brought Ben with him. We have to assume that for Jack, Kate, Sawyer, and the other survivors, their paths were also altered in some way. For one, Jacob, didn't visit them during the course of their lives to select them as his “candidates”.
So far this is all obvious stuff, but here is the not so obvious and the heart of my theory: They all died in the bomb blast that destroyed the Island at the end of season 5. From that point on, as previously mentioned, the space time continuum was forever changed. They had to live their lives twice. They had already lived their lives as we knew them up until the bomb blast. I’ll call that life their “original” lives. Now they had to live their lives again - this time in an alternate way – which I’ll call their “alternate” lives. So what about the survivors that seemed to survive the blast and continue on with their original lives in season 6? They were dead and living on as ghosts. Given the mystery of the Island this isn't a stretch of the imagination. Lots of dead people appeared as ghosts in all 6 seasons. Think about how much more mystical things became in season 6. Now that they were ghosts, they could see Jacob and understand some of the Island's mysteries that were so unclear to them when they were alive.
Now back to the alternate lives of the survivors. In their alternate lives, they never went to the Island and they knew nothing of the Island. However, slowly they began to have flashes of understanding of their original lives - the lives that ended in the bomb blast. Eventually they came together in a church and prepared to enter into the afterlife together. Jack's father explained to Jack that he was there because he died - that all of them had died and it was time to move on. I don't believe the death his father was referring to was a death in Jack’s alternative life. It was Jack's death in his original life. Jack and all of the other survivors were all still alive in their alternate lives. This “moving on” was the space time continuum correcting itself. When they entered the church and the afterlife it was at the same marker-in-time as the bomb explosion that killed them all in their original lives. They were not supposed to live past that time marker. They had to move on for the space time continuum to correct itself.
For this theory to work, there are some assumptions made. First, the Island wasn't purgatory. The writers have denounced this theory since the beginning. We just have to accept that the Island was a mysterious place - a place where ghosts live and time travel is possible, and where living people can also visit. We also have to assume that the plane wreckage shown at the end with the credits in the final episode was the plane Jack saw as he was laying in the bamboo and dying. It was the plane with Kate, Sawyer, and the other survivors. They never left the Island – they couldn’t because they were already dead from the bomb blast at the end of season 5.