Evil heather...?

[Joe]

In the bit in the church at the end, that guy, I forget his name, makes a comment about Heather saying something like, "You enjoy killing them, don't you?" then Heather says no i'm killing monsters or something then he says "They look like monsters to you?!" then says maybe he's joking.

Does that mean Heather is walking around normal Silent Hill and the monsters are really people that she's killing or something?