Every season of Lost has been dominated by a theme or unifying motif. In the case of recent seasons, it has been the treatment of various points in time as they relate to the big picture that is the "Lost" narrative. The fourth season introduced flash-forwards and the fifth season introduced parallel time periods. This season, it all seems to come down to alternate timelines.
The interpretation is this: that the explosion of Jughead, in conjunction with the Incident, forced time itself to split into two competing timelines. The first is the familiar timeline that has been the setting of the series since the very beginning ("Lost Prime"). The new timeline represents a scenario in which the island essentially sunk into the ocean in 1977. Thus, everything that happened in the Lost Prime timeline between 1977 and 2004, when Oceanic 815 flew over the island, never took place in this new timeline ("Lost X"). Also, one would imagine that the events connected to Jack and his people during the Dharma years would never have happened.
The idea being this: the two timelines pertain to the nature of the Incident in each timeline. In the Lost Prime timeline, the interaction of the nuclear warhead, the explosive electromagnetic anomaly, and the time/space anomaly at the Orchid tosses most of the people caught out of time back into 2007 (those within the vicinity of the effect, apparently), exactly as predicted in the review for "The Incident". So Lost Prime appears to still follow the same pre-determined rules: "whatever happened, happened".
But in the timeline of Lost X, there would have never been a nuclear explosion to interact with the explosive electromagnetic anomaly. It appears that in the Lost X timeline, the Incident was simply the uncontrolled release of the energy from the electromagnetic anomaly. That, and perhaps some interaction with the time/space anomaly, could have displaced the entire island underwater in an instant, as seen.
What would be the implications for Lost X? Any interactions between the familiar survivors of Oceanic 815 and those associated with the island would never have happened. The interconnections between them would still exist, if the island's inhabitants weren't involved. Perhaps most pertinent to the revelations in this episode, Sayid never would have shot Ben, Ben never would have grown powerful enough to force Charles Widmore into exile, and therefore Penny Widmore never would have existed. Desmond Hume would therefore never have been driven towards the race around the world that brought him to cross paths with Jack in Los Angeles before the flight.
This would potentially explain why Desmond could be on the plane, even though he wasn't in the Lost Prime timeline. But it doesn't necessarily mean that Desmond's presence is just a coincidence. The fact that Jack thought Desmond looked familiar is not an accident, and Jack's curious neck wound seemed to come out of nowhere, even from the perspective of the character!
And that might explain the importance of the Lost X timeline. Daniel Faraday may have been right to a certain extent: setting off the nuclear explosion at the time of the Incident may have opened a door that usually would have been shut. Instead of the pre-determined Lost Prime timeline, there is now an alternative: Lost X. But Faraday never expected that the two timelines would actually co-exist.
This brings to mind one of the principles of quantum mechanics, as illustrated by the example of Schrodinger's cat. In short, if a cat is placed in an airtight box with a vial of poison that will trigger randomly, then at any given time, one cannot know if the cat is alive or dead. From a certain point of view, both possibilities actually exist in that moment: in one version of time, the cat is alive, and in another, the cat is dead. Those two possibilities co-exist until someone (the "observer") opens the box. Once the box is open, the observer then knows which possibility is"real".
There are two prevailing interpretations of this principle. The first is the Copenhagen interpretation. In simple terms, this interpretation says that if there is more than one possibility, then all those possibilities co-exist until the moment of observation. At that point, something called "superposition" occurs: all the possibilities "collapse", leaving just "real" result. The other potential realities effectively never existed.
The second interpretation is the Many-Worlds Theory. In this case, for a given event, all possible outcomes are "real", but they all take place in their own separate timeline. These alternate realities typically don't intersect, although some versions of the theory disagree on the possibility and extent of any such intersection. In this case, just because one possibility is more likely, all other possibilities still continue to exist.
The question is: if Faraday's plan brought about a quantum event, which interpretation is the one in play? The answer to that question will likely drive the purpose of Lost X. If it's the Many-Worlds Theory, then it may be as simple as showing that the desired outcome was not nearly what Jack and the others thought it would be. But frankly, that wouldn't justify the time spent on Lost X, unless there was some unforeseen level of interaction that would have an impact on Lost Prime.
On the other hand, the Copenhagen interpretation could work, but there is the unfortunate side effect that either Lost Prime or Lost X would cease to exist. Potentially, if the "observer" were aware of both worlds, he or she could eventually have the ability to choose which timeline was "real". Consider the possibility: Jacob could know that his rival is manipulating events to ensure that someone arrives on the island that can help him gain freedom and achieve his goal, and there is no way to stop it. The alternative is that Jacob could ensure that events unfold as they have, creating an alternate timeline in which his rival is unsuccessful. All Jacob would need is an "observer", someone outside of the typical deterministic rules, to choose that alternative when the moment presents itself.
The downside in such a scenario is obvious: it would feel as though the entire story amounted to a reset button, with the plane crash never happening. On the other hand, since the events of the series would have had to have happened exactly as they did, in order for Lost X to exist at all, it actually gives the entire series a purpose. For all that happened on the island previously, this period of time would be the most significant, because it could very well save the world.
Of course, there's also the matter of the "observer" within all this speculation. The obvious choice is the one character that didn't fit in the Lost X sequence of events: Desmond. Desmond is already known to be outside of the established rules, ever since the implosion of the Swan Station, and it would explain why he was familiar to Jack X on the plane. Besides, if the Desmond/Penny relationship is central to the story, as the producers have often claimed, his decision to choose Lost X over Lost Prime, thus wiping out Penny and little Charlie, would be enormously tragic.
On the other hand, Desmond's presence in Lost X felt like it was meant to expose Jack X's perspective more than anything else. It remains to be seen if any of the others caught up in the Incident will also begin to notice odd things about Lost X in future episodes. If so, any of them could be the one forced to make the critical decision, if that is in fact the direction that the story takes.
But if all this is possible and viable, there is reason to think that Jack is the one who will end up making the call. It's simply this: the series begins with Jack waking up on the island after the crash of Oceanic 815. What if the seemingly better alternative, Lost X, turns out to be much, much worse in the end? What if Jack is left to make the same kind of choice that he made at the end of the fifth season, only in the hopes of ensuring the completely opposite result? Jack could end up choosing Lost Prime. (In which case, I would expect the final scene to be the exact same moment as the beginning of the series, bringing it all full circle.)
At this point, there's simply not enough information to account for all the possible directions. What is apparent is this: there are now two distinct timelines being explored: Lost Prime and Lost X. How they relate to one another, if at all, is clearly going to be vital to this last chapter of the Lost saga.