I'd love to hear your reasons for thinking it was Luther's dream sequence if you don't mind sharing!
Of course, I was planning on making a post about it anyway.
So I have a weird theory that this
could be Luther's dream/fantasy. It probably won't be, but hear me out.
The only world Luther knows is the Academy. It's the only world he is apart of, and feels is the only world that can accept him. When his siblings left, he felt abandoned by them. Because he could never leave, and they did.
Luther still believes in the ideals of their father, and that he did so much for the greater good. Even after learning the truth, Luther still listens to his father. Reginald and his expectations are engrained in Luther. He still will to follow his father till the end, even when he doesn't want to. He will follow his father, and stay with the Umbrella Academy, even if he doesn't really want to.
What if Luther's ideal world is all to have his family, together, as the Umbrella Academy. He thinks it's what he wants. Them all together in those uniforms, even as adults, following their father. They're the people he loves most in the world, and back in the only world he knew.
And... I may or may not be writing a fic about this. And I will say it I won't be surprised if that's not the case.