Can someone please explain to me this part "The spectators were aghast until they looked up at Kobun, who gleefully shouted, “Bullseye!”? I have a hard time understanding why Kobun did what he did.
A good example is the story "A Cup of Tea": [1]
Nan-in, a Japanese master during the Meiji era (1868-1912), received a
university professor who came to inquire about Zen.
Nan-in served tea. He poured his visitor's cup full, and then kept on
pouring.
The professor watched the overflow until he no longer could restrain
himself. "It is overfull. No more will go in!"
"Like this cup," Nan-in said, "you are full of your own opinions and
speculations. How can I show you Zen unless you first empty your cup?"
To me the ultimate purpose of this is to get people to see the flashes of blue sky that the article talks about, those moments of insight that help us see through the useful illusions we collect as a way of getting by in the world.
[1] From http://www.101zenstories.com/index.php?story=1 and I'd encourage interested parties to buy Paul Reps's "Zen Flesh, Zen Bones", a delightful book of similar and related material.
[2] You might also find a useful analogy in the Native American notion of a sacred clown, a heyoka: http://en.wikipedia.org/wiki/Heyoka
A few meanings I think are possible, I like the explanation that the observers were wrong to assume they knew where the target was ; It was after all his shot to take, he wasn't conforming to the expectation of the group.
Reminds me of "A wizard is never late, nor is he early, he arrives precisely when he means to".