Right. This way of describing it is much closer to "zero-worlds" or relational quantum mechanics, and to my mind is a far simpler, deeper way of understanding what's really going on - reality is simply all entanglement.

What really still gets me is the way it's not simply that the atom wasn't interacted with, but that if the information about the interaction never leaks to the outside world - if it's "erased" after the interaction takes place - then the system still behaves as if the interaction never took place.

It undermines not just the concept that matter really exists, but time as well.