Descartes wanted to establish a satisfactory basis for knowledge against which all knowledge could be justified. In examining dreams, he states that his dream experience is so real that he is forced to examine if that is not the reality and the other an illusion, or that, his whole experience might be part of a dream, a “continuous dream world,” as living while awake and dreaming while asleep, both seem so real.
Moreover, he says that, when he sees people being deceived and deceiving themselves, there could be a possibility that he is deceived in the innate things coming from God perhaps. That means that if God, as an “evil genius” is deceiving humanity, then we are completely lost because even the innate knowledge that comes from God Himself would be false. Therefore, we would have no solid knowledge base that could be used as a foundation for refuting all false knowledge and false information.
Then he introduces his, “Cogito, ergo sum” in Latin or, “I think, therefore I am” or, ‘I think, therefore I exist.’ In saying that he suggests that just the fact that he thinks means that he must exist because even the possibility that the statement could be false implies that he thinks and therefore exists. Now, I feel that since Descartes already assumes the I, otherwise, who is thinking, therefore, he has already assumed his conclusion and has committed the fallacy of circular argumentation which is, assuming what he’s trying to prove.
As for reality and illusion, I’d say look at your experience, what is more real? The awake world or the sleeping world? Obviously I’d say it’s the awake world. Therefore, that is the reality and the dream must be considered an illusion. I was going to say something else too, but it went out of my mind.
Personally I think that since our brain cannot and must not stop thinking or we would wake up not knowing who we are anymore, so the night time thinking comes up as dreams because while we are awake when we think, we only think in terms of images. In the night these images are dreams. We must dream all the time while asleep but don’t remember most of it. And sleep is a must to re-charge the brain cells, just like rest is a must for the body.
I don’t really understand your questions regarding Descartes, like who has formed those questions? Perhaps I don’t know Descartes so well. Whatever. 
(My jet lag isn’t over yet)