Peg - Steely Dan - A Lyrics Analysis

"I've seen your picture
Your name in lights above it
This is your big debut
It's like a dream come true
And when you smile for the camera
I know they're love it."

Peg is an actress, meeting a new Director/Photographer, who is telling the story in the first person as the one who is singing. He has taken pictures of her and created a billboard, with her name in probably neon lights telling the world who she is.

She is just starting out, and with his help, she expects big things of her life. He promises her that with his help, her face and her smile, she will hit it big with the public.

"I got your pin shot
I keep it with your letter
Done up in blueprint blue
It sure looks good on you
So won't you smile for the camera
I know I'll love you better."

Apparently, he noticed her when she mailed him a picture of herself with a letter, hoping that he would help her make it big in Hollywood. The picture was edited thru a blue filter. In a photo session, he encourages her to smile more.

"Peg
It will come back to you."

He assures her that everything he has taught her will come back to her when she in on display in public.

"Then the shutter falls
You see it all in 3-D
It's your favorite foreign movie."

He is again assuring her that she will be great when they start filming her on the movie set. By being on the set live, she will get to see the movie in real life, in 3-D, compared to the people who will see the movie, which will be 2-D.

They are re-filming and updating a movie that was already done previously, a movie that she loved, but this time, it will be the American version.