TL;DR: AWALT serves many purposes: It fights that ignorant wishful thinking. It is a reminder to keep playing the game and never stop being great. It is a defense mechanism/heuristic. It is a negative visualization, to be more content with what you already have. It is an application of cynicism.

AWALT serves many purposes:

1: It fights that ignorant wishful thinking.

It prevents thinking that your girl is the one, special, a unicorn. It fights the girls are great effect and their inbuilt halo effect. It prevents you from getting complacent in a relationship.

2: It is a reminder to keep playing the game and never stop being great.

Because past behavior doesn't entitle you to a reward in the present/future. You have to be the best man you can be.

3: It is a defense mechanism/heuristic.

Not all guns are loaded, but if you treat every single one as if it was, then you will prevent many accidents. If you start every new acquaintanceship with AWALT you will have a better time.

4: It is a negative visualization, to be more content with what you already have. (http://i.imgur.com/JMSiUb5.jpg)

Negative visualizations are great to get outcome independence, just visualize that you are going to fail, accept it, deal with the possible outcome and it won't bother you when it happens, another application of the negative visualization is embracing failure. Bonus: You will be happier when you don't fail.

5: It is an application of cynicism.

Social cynicism results from excessively high expectations concerning society, institutions and authorities: unfulfilled expectations leads to disillusionment, which releases feelings of disappointment and betrayal. Believing that others are mainly motivated by selfish concerns will crush your misplaced expectations.

AWALT can not be wrong. The strawman meaning of AWALT, the one where every women that has ever existed, all that exist and will ever exist are the same person is wrong.