I agree with your idea that we don’t believe that characters are real.

We react to fictional characters based on what they do or don’t do. What engages us emotionally is the plot, not the “personality” of the characters

Contrast Mr. Deeds Goes to Town with the Adam Sandler remake. The two protagonists have about the same personality and philosophy of life, but Remake Deeds is unengaging, because he’s essentially passive, while Original Deeds affects the outcome throughout (even when he refuses to speak).

Now a passive protagonist can be interesting (Chance in Being There), but the passiveness has to impinge on the action.

And a protagonist can be thoroughly unlikable — the sort of person you would shun in real life (the David Thewlis protag in Naked or the title character in Bronson). The audience simply has to care about what happens.