The Doctor's reality (The Not-So-Sinister Sponge)

The Fourth Doctor, Romana II, and K9 Mark II were trapped in a hazy and simplistic reality in which they went on endless frivolous adventures, caught in a cycle of amnesia only occasionally broken by flashes of their true personalities. The details of their adventures were always unimportant, with the Doctor and Romana going "on and on and on" until they got tired. Whenever they took a break from these adventures, they would revert to being inanimate toys. (PROSE: Special Occasions: 4. Playing with Toys) This world was at a vantage point outside existence which overlooked the end of the universe. (PROSE:  2. Do You Love Anyone Enough?)

When the Black Guardian enacted a continuity-breaking attack on the Fourth Doctor, Romana, and K9, the Doctor was forced to use the emergency unit to remove his TARDIS from the universe, "quite possibly forever". It was possible that they would end up in the fictional realm and "just be characters, not real people". The Doctor acknowledged that in the long run he might rather die, but in the moment he was impulsively determined. (PROSE: The Well-Mannered War) In their new reality, the Doctor and Romana remembered "when we came here", with the Doctor regretfully wondering if he "should have read the fine print a little more closely". Romana thought it was "not such a bad arrangement, while it lasts".

The Doctor once discovered a toybox which seemed to represent his situation. While he and Romana were toys being played with until they broke, the toybox contained an "exquisitely carved Chinese mandarin doll" which was still pristine because it wasn't played with. He sensed this doll was greatly important. (PROSE: Special Occasions: 4. Playing with Toys)

Behind the scenes

 * The reality described in the Special Occasions cycle of stories is indicated to be a "Side Step" to the world of the Doctor Who annual stories. Beyond the first story being named in tribute of an annual story, this is also indicated by the exaggeratedly simple nature of the danger in The Not-So-Sinister Sponge, the off-model photographs and educational content of Better Watch Out, Better Take Care, and the general concept of endless child-like continuity-less adventures explored in Playing with Toys.
 * Various other stories would indicate the Fourth Doctor annual stories exist in and are continuous with the Doctor's universe as a whole. Placebo Effect references Menace on Metalupiter, The Tomorrow Windows references The Eye-Spiders of Pergross, Every Dog Has His Day, and Menace on Metalupiter, and Mark of the Medusa acts as a sequel to War on Aquatica.
 * Gareth Roberts would later write another homage to Doctor Who annual fiction, Voice from the Vortex!.