Question

what was Michael's theory about how Sebastian had entered the game

Answer 1

Miachel thought that while sebastian had hit his head during the motorway accident he must have been plugged to the virtual reality game the computer must has saved his memory as it own. And he must have got the games after they are stolen from the shultzs.

Answer 2

Michael believe that at the time of his accident shultz was playing one of the same psycho drive game on his laptop that even the narrator had. since Sebastian had been plugged into the computer when he benged his head in the ancient the computer had saved his memory on it's own and the weird version of the game that that that the narrator had been drawn into, had all attempts to retrive sebastian's memory.