Tidus may catch the edge... or he's just baffled by the set-up. Actually, even more so as Taiki goes on. Though maybe he understands with a little more thought:

"So the kingdom at the top is the one in charge, and you all get along? There's no fighting? You just rule over the different lands?"

If it's like that, then maybe Tidus can understand. All those movies about kingdoms usually have them fighting or ... definitely not in charge of each other.