That's what I'm leaning towards too, except I disagree with the idea that "everyone's happy" in the world of Deltarune. They might be by the end of the game (I mean, hopefully?) but I thought Hometown had a very melancholic feel to it in chapter 1 where things seem happy on the surface (yay, monsters and humans living together on the surface, Asriel's alive, Toriel's a teacher, etc.) but as soon as you look a bit deeper into it there's a lot of depressing things going on, Alphys is a bum and doesn't know Undyne, Mettaton is a recluse with nobody to build him a perfect body, Asgore is still divorced and about to be evicted, Noelle's father is hospitalized because of some major illness and her mom is too busy being the major to be physically and emotionally present for her husband and daughter, Susie might come from a poor family since she wears ragged clothes, might be malnourished and her house is nowhere to be found in Hometown (maybe there's a trailer park in the outskirts of town?), and of course there's whatever the hell Kris is going through