@Psychronia if i had to guess, believing that it was a fairytale is something like a self-defense mechanism.
She got reincarnated into a strange world, but believing that it was a story she
knew helped her to keep herself stable.
It's the slight difference between being lost in the middle of nowhere
. . . and being lost in the middle of nowhere with a map.
The map, in this case, coincidentally had similar landmarks to what she was seeing.
But on further inspection, it seems like it might not be the right map.