Could be. I mean, think about it, right? Each time we've had people wake up somewhere different, they're physically different than the last thing they remember in the dome. Hair color and length, scars, injuries, how much I've shaved. But then, when we come back to this "virtual prison", [air quotes] we go back to exactly what we were before we left.
Squall wasn't any different than when we woke up after going through the secret door in the first dome. And, from what I've heard about the doors here, it was no different than that.
I'm thinkin' they physically moved our bodies from whatever that facility is in now to the Squall prison while we were knocked out... and then moved us back again when things here were fixed.
I'm thinkin', that giant squid attack was more than they're lettin' on.
[A healthy dose of Gundam pilot paranoia probably helped him along with this theory, but sure.]