I have no doubt they hired real engineers to build a real prototype. Maybe they even hoped it could turn out to be practical. But the primary motivation and the end game was always to get people talking about Amazon during the critical shopping period.
(On a side note, the whole thing has a striking symbolic aspect to it. How does Santa Claus deliver Christmas goodies? He magically flies to your house and delivers them directly from the sky. And the drones do exactly the same thing.)