Here's my observation: that if you're crazy and you don't know that you're crazy - no matter what level of crazy you are - then by not knowing you're crazy are you thus insane. Crazy, of course, meaning "having psychological issues" rather than being mentally abnormal... because the concept of "normal" is like the concept most people think of when they hear the word "perfect" - it just ain't possible. Even the Divine is not normal, just as the Divine is not perfect either. Perfection as most people think of it - that of being always right and never making a mistake - is an absolute impossibility.
And of course by "insane" I mean "being so lost in your psychological issues that you mistakenly either think you are sane, or you are no longer capable of contemplating the issue." Therefore, a person who hears voices and sees hallucinations, but knows that these things are not real, is sane. But a person who organizes their sock drawer in alphabetical order by brand - pitching a fit if one sock is misplaced - and does not realize (or denies to themselves and others) that they have some issues to resolve, now THAT person is insane.
And so we see that if you are crazy and you are aware that you're crazy, then by that measure you are sane. So it doesn't matter how crazy you are, if you know you're crazy then you're perfectly sane.
The first inspiration for this theory came from watching the movie "A Beautiful Mind." At the parts where he was crazy and he didn't realize he was crazy, he was insane. Later, after deciding that he had to go off the medicine to get his genius-level math skills back, when he was seeing the fake people and hearing the fake voice but he knew they were fake and ignored them... it was then that he was crazy, but sane.
I estimate that at least 60% of people in the world are, by this definition, insane. And a lot of the people - I daresay most of the people even - who are in the 40% of those who are sane, are people who are crazy and yet know that they're crazy. I daresay all, because I have yet to meet a human being who was not crazy in some manner. EVERYONE has psychological issues.
Myself, I am in the 40% of the sane. Yes, I am rather crazy... I'm a multiple who has at least two Faces who both have issues with the world. One is too scared to come to the Front in the daytime, the other is very angry and less than social. I have issues, including trust issues, from being abused by my peers for most of my younger life. I have a hard time comprehending other peoples' actions and words because no one seems to have any sense and because I might well have Asperger's Syndrome as well. And I have other issues I am not willing to talk about here and now. Yet because I know I'm crazy, and I'm trying to fix it, this makes me sane.
But during my Exile, I did not know I was crazy. At that point in my life, I was insane.
Which are you?