there are variations to diegetic music. one is "metadiagetic" sound. these are sounds the characters imagine. the sounds are not heard in the surrounding reality. this is not that common in films. an example is in "amadeus" (1984). composer antonio salieri, played by f. murray abraham is reading music composed by mozart and the audience hears what salieri imagines in his head. there is no actual orchestra present in the scene playing the music.