I understand what Cineanalyst said about how Méliès wanted his audiences to know his trickery was artificial, and I certainly don't disagree with this reasoning, but I believe the way he has a different backdrop at the beginning of this short is simply for the purposes of advertisement. The posters on this first backdrop clearly advertise his shows at the Théâtre Robert-Houdin (that is, if you can see through the poorness of the print) so in a way, Méliès was trying to broadcast his live magic performances while illustrating it with this simple, yet impossible-to-do-without-effects, gimmick. This is not to say he created this short entirely for advertisement; on the contrary, this first backdrop is only there at the very beginning, and there is no particular emphasis on its intentions. Then again, I suppose the prints Méliès had first shown his audiences back in 1899 were not as decomposed as the available one now and made the audiences clearer on what the purpose of the original backdrop was.
With that said, this little magic show is one of the Méliès works which focus entirely on a single gimmick. Instead of a series of trick shots, as in "The Magician" (1898) and "The Astronomer's Dream" (also 1898), "The Mysterious Portrait" focuses, in this case, on the concept of Méliès creating a living version of himself inside a picture frame. Even though it seems simple enough, it was not easy to make, involving two separate shots, one superimposed into the other. Considering this short was made only in 1899, it is actually astonishing to see how good the double-exposure looks when viewed now. And let us not forget Méliès's charm that he shows onscreen when interacting with his selfie, and how the portrait resents the magician making him vanish from the frame again. No matter what subject, comedy was always an ingredient to successful filmmaking in Méliès's filmography. A simple diversion, but a good one at that and also one of two films by the same director that feature the lens de-focusing combined with matte shots--the other one being "Summoning the Spirits" from the same year, which uses a similar concept as well.