it makes absolutely zero sense how some of the characters are at the church at the end and others are not. Boone as prime example and Shannon (Only due to the tie-in with Sayid) to a lesser extent being there, yet Daniel, Richard, Miles and least of all Michael and the once highly important Walt (Remember him..???) maybe even Frank being there or even Eko would have made more sense than Boone.
I interpreted the sideways timeline as being a place that's "made up" - a sort of replication of the world, except one where the losties are happy. Therefore nothing in that world is real, except for the losties themselves. It was a place made solely for the flawed characters, so that once they all in the real world had died they could see what a happy life they could lead.
Characters that were significant to the losties lives were also there; some of them were a part of this replicated, fake world, and some were real (to an extent) but were not ready (as Hurley says) to "move on".
Basically the sideways timeline is similar to the Matrix. A fake world; certain characters realise that they are in purgatory (or a step in between Earth and the afterlife/Heaven) and go on to help others realise this.
That's just my interpretation as I can best describe it though.