"Reality is an illusion"

I have a great respect for the continuum of Eastern religions that includes Buddhism and Hinduism. But, I have to take objection to the concept that reality, even physical reality, is an illusion. Illusions must have referents; an illusion must be an illusion of something in particular. A mirage is an illusion of water in the desert. Water exists, the mirage refers to it in the way that it looks, but fails to actually satisfy the desert wanderer's thirst. So, if reality is an illusion, what is it an illusion of? Rather, I think what is intended, is that the model of reality which we build in our minds -- a model which attributes permanence, primacy and importance to the physical layer of reality -- is an illusion. Reality itself exists, and doesn't refer to anything external. But physical reality is ephemeral, not permanent. It is secondary to mental and spiritual reality, not primary. And therefore, it isn't overly important as an end to itself, but rather it's importance lies in being the medium through which mental and spiritual reality expresses itself. It is our attachment to physical reality which is illusory, not physical reality itself.