i know a lot of people get confused about this movie (i did, the first 6 times i watched it), but i think i have it all figured out. so here it is:
Abe discovers that the machine can be used to travel back in time. he makes two machines - one to use and one to alwasy have on, as a failsafe, in case something goes horribly awry.
intitially, he lets Aaron in on this in the park. Abe shows Aaron the way it works and everything, but Aaron has NOT used it at this point.
that same evening, Rachel's ex pulls the shotgun. neither Abe nor Aaron are at the party this time around.
once Aaron learns how the machine works and finds out about the failsafe, he uses the failsafe to go back to the day that Abe tells him about the machine.
he goes back, drugs his 1st version of himself and puts him in the attic.
then, he goes through the day again and records every conversation he has.
later at the party Aaron rushes the gunmen and no one gets hurt. Abe is not at the party this time.
Aaron decides to do it once more, with the recordings he made, to do it "perfect". he goes back, waits for his 2nd version to drug his 1st version and then attacks him, but loses the fight (due to sleep loss). still, his 2nd version leaves and lets his most current (3rd) version continue). his 2nd version now becomes the narrarator.
Aaron goes to the party, becomes a hero, and continues on with his life.
he now is living the timeline that you see through most of the film. he goes on his "first" ride with Abe, looks for the cat, etc.
this is why Aaron's ear bleeds, why he has trouble writing (at the library Aaron is writing stocks, he takes a long time to write just the number 3 and has to steady his hand. Abe notices this, but says nothing about it).
so, fast forward to the night that Abe is woken up by the kids and the car alarms. he goes to Aaron (#3 still) and hatches his plan.
they run into a version of Granger. they know its not the original, cause they call him - he was sleeping. we dont know how Granger got to the time machines and why he had come back. neither do our characters. this Granger is from a future that neither of them have experienced yet.
regardless, Abe knows he must stop this by going back to the beginning and stopping the whole chain of events.
now, you may ask - how does Abe go back if Aaron has already used the failsafe to be a hero at the party?
this is where the 'modular' bit comes in.
when Aaron uses the failsafe, he takes another machine (folded up) with him. when he gets out at the first day (when Abe turns the machine on initially), he sets up a new machine and turns it on. this is the new failsafe. he must do this again when he goes back once more to make things "perfect".
so, Abe goes and uses the failsafe (the one Aaron set up) and comes back to the day he first turned it on.
he drugs his first version and takes his place.
when the 2nd version of Abe confronts the 3rd version of Aaron at the park, they both realize that they are future versions of each other.
remember that, originally, Aaron 3 went through the whole day playing his cards just right, going by the recorded conversations.
when Abe 2 enters the story, things have to change. he has to let Abe 2 in on the story. but they still have to go do the party.
heres a big key - Aaron tells Abe "he didnt [fire] when i wasnt there (the original time), he didnt fire when i was and rushed him (the 2nd time), and from what Robert tells you, he didnt tongight." meaning that the version of events that Abe 2 had experiened throughout the whole story was with Aaron 3, the same exact Aaron that he is talking to here. but Aaron 3 hasnt been the hero yet as Abe knew him in the future.
still, things have become fubar'd with Abe coming back. Aaron can no longer go on pretending like nothing had happened, cause now there are 2 Abes and 3 Aarons (#2 has left, #3 is playing the role of original Aaron).
SO WHAT HAPPENED TO THE ORIGINAL AARON (who has NEVER time travled)????
well, i have a hunch there are not birds or rats in the attic.
so, with things changed, Aaron #3 leaves, letting his original wake up and deal with what is going on, rather than CONTINUING TO DRUG HIM AND KEEP HIM IN THE ATTIC.
Abe stays behind, hoping he can prevent his double from ever using the machine and Aaron #2 starts building something, well, BIG.
this should sum up the bulk of the plot for you. yes, there are still a few inconsistencies, but they be minor