This kind of thing happens alot. During the first Gulf War, I don't know how many guys were running around pretending to be soldiers home on leave. Knew a person one time that told everyone he was a Vietnam Vet for so long(years) that most people he knew thought that he was really when in fact had been locked in a mental institution during the whole period of time. Even told stories of experiences he had during the war which he had heard from the real deals. This person is quite possibly mentally ill in the same way. Passes off as normal to those that don't really know them, but to those that do(like the sister) doesn't. The sister may think she is just a chronic liar not realizing her sister is mentally ill. To meet one of these people you would never guess they are mentally ill as they behave normal and tell their stories as if they were really there adding even small details and personal touches like veteran clothing and everything. They pretend or play the part of people they think will get special respect. Like in this case. I'm no doctor. That's just my take on it for what it's worth.