I suppose we can't know for sure. We can't even know it's true nature until we've experienced the whole cycle and probably, not even then. If we die and that's it- that's the end of knowledge for us. If we reincarnate on this world, chances are our memories are wiped or else- we'd all remember past lives- surely?
All we can know is the nature of the states we experience right now. We know that we genuinely do sleep and dream when we're alive. We know that in our waking hours, we need to eat, drink and take care of ourselves or face very unpleasant consequences. So- no matter the truth of what's real or not, it doesn't alter the fact we inhabit sentient bodies that require lots of stuff. That feels all too real to me.
I kind of wish this were a dream. I'd have a whole lot less responsibilities! Plus, I can fly in my actual dreams. I don't think biology or physics would allow me to in waking life. I imagine it's not because I just don't try enough or don't believe in myself enough. I think it's probably impossible for humans to fly without gadgetry.