I'm starting to lean towards the time travel theory. It makes sense in explaining lots of events on the show. It's already been established that one of the characters has time traveled, and that's Desmond in "Flashes Before Your Eyes." It would explain Richard Alpert not aging in "The Man Behind the Curtain" as well as why Jacob was flickering in and out of being seen in that episode as well (caught between timelines). It also would help the popular theory of Locke being Jacob, in a different timeline. It would also explain all the different connections between the people as only certain people make appearances in other Losties' flashbacks. Here's the list of connecting people in Flashbacks who may just be Dharma people traveling through time making changes:
1) Libby (we've never seen a flash back from her and she appeared in both Hurley's flashback as an observer and Desmond's as a catalyst - she gave him the boat)
2) Kelvin Inman (we're still not sure that he was a Dharma employee when we saw him in Desmond's flashback. He also showed up in Sayid's Flashback as a person who caused Sayid to make a difficult decision in his life)
3) Richard Malkin (the psychic who was the catalyst for Claire going to US and winding up on the island and also caused Mr. Eko to doubt his faith during the conversation about his "back from the dead" daughter)
4) Dr. Christian Shephard (he's caused Jack much distress and emotional turmoil in Jack's flashbacks; he's also had a drink with Sawyer the night that Sawyer shot the wrong man; he was the catalyst for Ana-Lucia coming to Australia and winding up on the island; and he turned out to be Claire's father which made an impact on her story)
5) Randy (he was the jerky manager of both Hurley at the Chicken Shack and Locke at the box company, a character whose attitude affected the decisions of both of those characters)
6) Anthony Cooper (Locke's father which caused him so much stress that his life was completely altered in a new direction that that it had been on before he met him; he also turned out to be the man Sawyer was looking for, the one who made Sawyer's life go into a new direction for revenge)
7) Emily Locke (Locke's mother who was a catalyst in the situation with Cooper for John; she also showed up in Hurley's flashback as an observer)
8) Nadia (was the main catalyst in Sayid's life and the cause for him winding up on the island; she showed up in Locke's story as an observer - hers was the house he was inspecting)
9) Adam Rutherford (Shannon's father, he served as the catalyst for the tension between Shannon & Boone; his death was the catalyst for Jack's marriage to Sarah)
10) Cassidy (Sawyer's girlfriend who he cons, but lets in on the art of conning, she becomes his reason for thinking about giving up his life of the con; Cassidy befriends Kate and helps her see her mother one last time)
It is possible that all the characters listed above are time travelers working for Dharma (or someone else) and purposely observing or making changes in the main characters' lives.
Theory by scottgingold
1) Libby (we've never seen a flash back from her and she appeared in both Hurley's flashback as an observer and Desmond's as a catalyst - she gave him the boat)
2) Kelvin Inman (we're still not sure that he was a Dharma employee when we saw him in Desmond's flashback. He also showed up in Sayid's Flashback as a person who caused Sayid to make a difficult decision in his life)
3) Richard Malkin (the psychic who was the catalyst for Claire going to US and winding up on the island and also caused Mr. Eko to doubt his faith during the conversation about his "back from the dead" daughter)
4) Dr. Christian Shephard (he's caused Jack much distress and emotional turmoil in Jack's flashbacks; he's also had a drink with Sawyer the night that Sawyer shot the wrong man; he was the catalyst for Ana-Lucia coming to Australia and winding up on the island; and he turned out to be Claire's father which made an impact on her story)
5) Randy (he was the jerky manager of both Hurley at the Chicken Shack and Locke at the box company, a character whose attitude affected the decisions of both of those characters)
6) Anthony Cooper (Locke's father which caused him so much stress that his life was completely altered in a new direction that that it had been on before he met him; he also turned out to be the man Sawyer was looking for, the one who made Sawyer's life go into a new direction for revenge)
7) Emily Locke (Locke's mother who was a catalyst in the situation with Cooper for John; she also showed up in Hurley's flashback as an observer)
8) Nadia (was the main catalyst in Sayid's life and the cause for him winding up on the island; she showed up in Locke's story as an observer - hers was the house he was inspecting)
9) Adam Rutherford (Shannon's father, he served as the catalyst for the tension between Shannon & Boone; his death was the catalyst for Jack's marriage to Sarah)
10) Cassidy (Sawyer's girlfriend who he cons, but lets in on the art of conning, she becomes his reason for thinking about giving up his life of the con; Cassidy befriends Kate and helps her see her mother one last time)
It is possible that all the characters listed above are time travelers working for Dharma (or someone else) and purposely observing or making changes in the main characters' lives.
Theory by scottgingold
