By Owen Gleiberman
Updated October 11, 1996 at 04:00 AM EDT

Dadetown, the most dizzying cinematic stunt in many a moon, only looks like a documentary; in fact, it’s a fake, staged with devilish authenticity by writer-director Russ Hexter. Hexter plays it so close to the bone that he all but seduces us into the illusion we’re meeting the citizens of Dadetown, N.Y., a homespun community that’s quietly being homogenized by API (American Peripheral Imaging), a corporation of smug yuppies who turn everything they touch into plastic shopping-mall fascism. (They destroy the town in order to save it.) The sinisterness of API is everywhere — in the cappuccino shop no one wants, in the way the bland corporate-speak of the company officials begins to seep into the rhythms of the locals themselves. The brilliance of the movie lies in how Hexter, a wizard of irony who died of an aortic aneurysm last April at 27, treats the genre of sober-minded PBS inquiry less as a form to be ridiculed than as a metaphor for what’s happening in the community: The ”filmmakers” understand that Dadetown is being paved over by high-tech urban colonialists, but all they can do is stare on in impotence (the exact situation in which the citizens find themselves). Years from now, when people want to know what finally happened to small-town America, Dadetown will be the movie to watch. A