It is possible to differentiate between 'illusion ' and 'reality' mentally, but the reasoning faculty has to be rectified first, from form to formless in order to differentiate between unreality and reality.
The look of an object will depend upon the medium through which the observer views it. In fact our mental and intellectual conditions will determine the the dual[waking/dream] and non-dual[deep sleep] experiences which comes and goes in succession. The worldly man viewing the world will see it differently from a Gnani viewing the same world. Each one of us interprets the object that he sees in term of his existing accumulate knowledge. A Gnani sees the consciousness in everything and everywhere in all the three states, therefore he sees the three states as consciousness alone. Thus consciousness alone exist all else is illusion.
Intellectuality deal with lower knowledge based on the ego/physical self. One has to ignore all accumulated second-hand dross and go in search of higher truth on his own. The accumulated knowledge without verification of its validity are unsafe rafts for crossing the sea of illusion of birth, life and death. Doomed to shipwreck are those who try to cross the sea of illusion on these poor rafts. Ignorant of their own ignorance, yet wise in their own esteem, these deluded men proud of their vain learning go round and round like the blind led by the blind.
