Virtual YouTubers (VTubers) are avatar-based livestreamers that are voiced and played by human actors. VTubers have been popular in East Asia for years and have more recently seen widespread international growth. Despite their emergent popularity, research has been scarce into the interactions and relationships that exist between avatarized VTubers and their viewers, particularly in contrast to non-avatarized streamers. To address this gap, we performed in-depth interviews with self-reported VTuber viewers (n=21). Our findings first reveal that the avatarized nature of VTubers fosters new forms of theatrical engagement, as factors of the virtual blend with the real to create a mixture of fantasy and realism in possible livestream interactions. Avatarization furthermore results in a unique audience perception regarding the identity of VTubers - an identity which comprises a dynamic, distinct mix of the real human (the voice actor/actress) and the virtual character. Our findings suggest that each of these dual identities both individually and symbiotically affect viewer interactions and relationships with VTubers. Whereas the performer's identity mediates social factors such as intimacy, relatability, and authenticity, the virtual character's identity offers feelings of escapism, novelty in interactions, and a sense of continuity beyond the livestream. We situate our findings within existing livestreaming literature to highlight how avatarization drives unique, character-based interactions as well as reshapes the motivations and relationships that viewers form with livestreamers. Finally, we provide suggestions and recommendations for areas of future exploration to address the challenges involved in present livestreamed avatarized entertainment.