It was a dream. Booker woke up from it at the end. Cause multiuniverses and cities in the sky aren't real.
They set themselves up perfectly for that, and I'm sure the last DLC will explitly say that so they can go to next-gen Bioshock with a clean slate (in other words, they used the ending twist just because they needed a twist, and will drop it cause it would be dumb to follow up on it).
Obviously they won't say this until much later, because people hate the 'dream' conclusion and will start shitting on the game when they realize it.
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