Actually there are three Aura: the "Fantasy Aura", the "Real World Aura" and the "Mental Chamber Aura". The first one is the Real World Auras's projection in the fantasy world, so they are totally aware of what each other do. The Mental Chamber Aura is the one who exists keeping the other two in the dark of her existence, so we can say you are wrong but also right.I really enjoy the game, but I think what was at first incredibly subtle corruption now strains my suspension of disbelief. Aura is just too smart in my mind to not realize the changes in her are just too drastic and negative while she's every night fighting against demons of corruption. And it's obvious person who is encouraging her corruption is Alicia and the one who is trying to keep her virtuous is Rose. So it's just no longer believable to me.
What helps me in my head cannon is if Aura in real life, just like Rose and George, isn't aware of the fantasy world she visits every night. If she wasn't consciously aware of her nightly efforts to fight corruption and curses then her believing the changes in her are just her 'growing up' would be completely plausible.
In my head cannon, fantasy Aura is also not aware of what's happening to Aura in real life. Of course fantasy Aura knows who she is, but just like real Aura just thinks she's having vivid dreams of a fantasy world, Fantasy Aura also just gets glimpses of how she's changing into a selfish and shallow person in real life. That would also explain fantasy Aura not realizing that her taking off the collar or doing other corrupt acts is allowing Alicia to corrupt her in the Mind Palace.
It also explains how Aura hasn't gone nuts from sleep deprivation, each side of her is getting some shut eye while the other is conscious.
About the sleep deprivation, don't worry: it's a kind of magic.