As I said here, I don't think Music is a good fit for the film. I haven't watched Moulin Rouge! in a really long time, but I remember it as a standard Musical (unfortunately not a genre option).

I believe the characters are cabaret performers and the music is part of the plot. I've not seen it in a while either.

I for sure could be wrong. Let's leave this report open, maybe someone else has watched it more recently.

I watched it recently and some of the songs are performed as part of the story, but then other songs are used as a means for the characters to express their emotions.