In the ballet and other examples, the difference to me is that they’re not pretending to be in a ballet competition while dancing the ballet.

In the Nutcracker, at least, they’re pretending to fence, in a choreographed dance. A first-time naive viewer who came out of the show offended when they discover skill at fencing has nothing to do with whether the dancers playing the Nutcracker or the Rat King wins would sound silly.

I do think that the kayfabe is what sets wrestling apart from more traditional performance art. The carnival-barker lying-to-your-face aspect of the performance is what makes it feel extra circus-y. But when you accept that the kayfabe is just part of the performance, you stop feeling offended by it and start recognizing degrees of commitment to the bit as part of the artform.