Dennett as a philosopher was a jerk. I read his "Consciousness Explained" in which he does *not* explain consciousness.
To Dennett as a hard-core materialist, anything that is not material does not exist. And subjective experience is not material. But subjective experience exists. Therefore it's an illusion. In the book he readily admits he has conscious experience.
Bottom line, it's a semantic problem. For Dennett, in effect, illusion is anything outside of science. He's using "illusion" as a catch-all term for anything he can't scientifically explain. He doesn't mean illusion in its standard sense. He is a jerk because he doesn't explain his semantics.
You could just as easily say, as Galen Strawson does, as quoted by David Lewis in his comment, that conscious experience is real, therefore the material world is an illusion -- an illusion "created" in the mind.