Nagarjuna's Madyamakha philosophy is only half the story. He was simply negating two extreme views. The other half of the story is what is actually real, namely, that found in both Yogacara and Tathagatagarbha philosophy. There is no Buddhist school I can think of that follows Madyamakha exclusively, but I could be wrong. Most Mahayana schools temper it with Yogacara and Tathagatagarbha.
By stating that reality is an illusion is to make a claim, which is something Nagarjuna did not do. But it's not that reality is an illusion, it's that our delusions have tricked us into thinking that reality is something it is not. What is actually real is Buddha-mind/nature. This is the underlying reality, this is what is true reality. The three poisons have us deluded into thinking that what we see, is what is real. But this is not the case. Our minds have been clouded by the three poisons of greed, aversion, and ignorance, because we still think in dualistic ways. The Buddha-nature is what is real, and what underlies all of what we think is real.