This scene in Porco Rosso shows Marco's true face for a quick moment. Teenage Fio is shocked at the sight, but when he realizes he is being watched, Porco's pig face returns. It's a great moment that gets at the heart of the hero's identity and the movie's themes of being bound to the past and the romance of nostalgia.
Western audiences can never understand why Porco Rosso has a pig's head, and this insistence on literal "realism" in animation is slightly depressing. Nothing about this medium is real. You are looking at pencil drawings and paintings, not actors on a soundstage. You are looking at something that is itself a product of the imagination, and that fact carries a certain surrealism and symbolism in its very bones.
Miyazaki portrays Marco as a pig because it represents his disgust with humanity as a result of his experiences fighting the Great War. He feels disconnected from the outside world, not only those who never had to fight, but those who allowed the war to happen. The war robbed him of his best friend who had just married his true love, and out of loyalty he has stood aside all these years. He has lost his friendships and his very future, and has accepted this as his personal cross to bear, a survival's guilt that manifests in the curse of the pig face.
Much like Howl's Moving Castle, this movie shows us the psychological costs of war and what it does to those who fight. Howl the wizard was slowly turned into a monster that overcame his humanity and identity, leaving him an inanimate creature by the very end. Marco/Porco is likewise split between two identities and has lost his true sense of self. It is only by making a new friendship with Fio that he begins to reclaim his humanity once more.
Marco is deep in his work on the beach, and so he lowers his guard, lowering the mask that he shows to the outside world. We see his true face, or at least the romantic ideal of how he would look, as an older version of the young boy who fought the war. Perhaps he is meditating on that conflict and his vow to kill his rival, Curtis. Porco Rosso has famously vowed never to take another life (a fact that is revealed later), but now he seems prepared to cross that line. But then Fio moves and he is quickly snapped out of his meditative state. Porco is back in character.
The image of Marco also serves as foreshadowing to his story of the great air battle, in which so many pilots were killed, including his childhood friend. It also anticipates the coming battle, which is expected to be a fight to the death. We know why Curtis is fighting. He's fighting to take Porco's place, not only in the skies but at Gina's side. But why is Porco fighting? Is it pure cynicism and detachment, or merely revenge? Is he fighting to hold onto Gina, who he loves yet also keeps at arm's length? Should he still be duty-bound to a friend long deceased? Should he run away with Fio instead? Should he still cling to his own myth and identity? And what if clinging onto that mythical identity costs him everything else? Who will you become once you can no longer be yourself?
All things must pass. This is the major emotional thrust of this movie. This is the lesson that Porco must learn in order to survive, and this shot and scene is where all those threads come together. The climax isn't really the air battle, which ends in a comical cartoon farce. Miyazaki isn't interested in machismo or settling scores. He will instead take the air out of the tires and turn the external conflict into one big joke. It's the internal conflict that matters. There the real war will be lost or won.
