On page 3, Steve says, "I feel like I have walked into the middle of a movie." Everything that he is experiencing in the prison feels like something from a Hollywood blockbuster, and, as such, he decides to write it down in the form of a screenplay. Not, he says as "the story of my life...but of this experience." In other words, he claiming he's using his love of films to help him get through what is for someone of his young and sensitive disposition, a surreal and traumatic experience.
However, as the story goes on, the reader starts to wonder if Steve is guilty after all. Some of the actions that he describes in the script, such as how he reacts to hearing the news of the drug owner, certainly suggest he had some involvement in the crime. So from this perspective, the script works as a way for him to distance himself from what he has done. Movies are for him a fantasy world that he can disappear into without suffering the consequences.
He seems torn, however, between admitting his guilt, if only to himself, and denying he has had any involvement. At times, this unease communicates itself through how he sensationalizes the material. For example, he calls the film "Monster! The Story of My Miserable Life." It is not really a title that one would usually give an honest and realistic film.