Memory is a funny thing. What one person remembers can be quite different from another person. Some of it is perspective, some of it might be personal views on the important aspects of an event. Apparently what language you speak and hence what words you have at your disposal also affects what you understand and remember about events. Presumably NLP works differently in different languages.
Most people seem to have their first memories around 4 or 5, although if you try to remember your earliest memory it is difficult to separate what you remember from what you have been told and photographs you have seen. My mother in particular seems to have taken advantage of this and denies events that I specifically remember in an attempt I allege is a rewriting of history. Her brother, meanwhile, used to allege that he could remember being born. Clearly we are a family for whom the truth has been a malleable concept.
But while our memories are already somewhat fallible tools, imagine if, like Star Trek, you had a holo-deck, and could create completely fictional events. You could people your events with real colleagues, friends and acquaintances. And while to you, they would seem to be real experiential memories, the other people would have absolutely no knowledge of the events you created.
PS Stumbleupon just showed me a Wikipedia page on parataxic distortion which expands on this concept.