David -- it's made pretty darn explicit. For one thing, in the opening sequence, after the credits, the camera moves through a live-action kid's house (live action characters saying "come on!" "it's time!") and zooms in onto a computer screen showing Dora and her friends. The shot ends anchored on the screen and never leaves, for the rest of the show -- we have entered the computer.
And then, for another thing, there is a little mouse-cursor that flies into the frame and clicks on things occasionally. Say Swiper has stolen the steering wheel of the squirrel's car (in my opinion as an act of vigilante civic duty, given how badly that squirrel drives, but nobody asks me).
Dora asks the viewer to think about what the wheel looks like, then indicates a bunch of objects lying in the swamp (many of them other, non-circular or non-yellow steering wheels, presumbaly abandoned by other victims of Swiper's civic zeal who lacked Dora's tenacity). "Can you help us find the wheel? Where is it?" Dora implores the viewer. After a moment, the mouse cursor zooms in from stage left, hovers, and clicks on the correct wheel, lighting it up. "There it is! You did it!" cries Dora, bizarrely giving the viewer credit for the actions of the magic mouse cursor. The viewer is being asked to identify with the player of an imaginary computer game of which the TV show is a mimesis.
The whole plot of the show, too, is the plot of a computer game. A quest is announced (an object lost, a gift that must be delivered, a lost person who must be helped home). The Map ("I'm the map, I'm the map, I'm the map!") is consulted. There are three places (levels) that must be traversed (e.g. "river, tunnel, snowy mountain!"). Each consists of a series of puzzles and encounters (often with Swiper). The puzzles are video game puzzles -- jumping from whale to whale across a crocodile-infested river, say, where the whales are moving back and forth Frogger-style, and the viewer implored to tell Dora & co. when to jump: "shout 'salta'!"
(This makes it sound just eeriely dead and mechanical. And it *is* eerie, but there are also gags and grace notes, and Dora's winning, resolute personality to pull you through.)
Yes, Levi, Dora is designed for, I'd guess, 2-5 year olds, while Arthur is designed for, I think, 6-9 year olds. It's always 6-9 year old kids featured in the interstitial live action sequences in Arthur. Arthur is 8; Dora seems to be about 5 or 6.