Actually, the people who are making the claim that the hallucinations are external entities are asserting a position. And with a quick application of Hitchens' Razor, that which is claimed without evidence can be dismissed without evidence.
They do have evidence - their own experiences! It’s not very convincing evidence, to be sure, but as the replication crisis shows, even “objective” evidence can fail to be convincing or demonstrative for various reasons.
And what evidence do you actually have for your position? Your position is tailored to make subjects better taxpayers, rather than understanding how the brain/mind actually works. That's ok, than just assert this, that it is just a position amongst an infinity of other positions, rather than claiming that your position is the ultimate truth.
So someone is experiencing the self-transforming machine elves. Please provide the exact description of neuronal circuitry (numbers of neurons, network architectures, interconnectivity patterns, amounts of neurotransmitters used, spike patterns and the resulting EEGs etc) which generates this exact experience. Ask a distinguished professor of neuroscience. Use integrated information theory, emergent properties, quantum collapse in microtubules, whatever currently established paradigm - and provide the exact, 100% comprehensive and full description of the brain state that presumably generates this exact experience, also allowing to differentiate from all other experiences like just "machine elves", "non-self-transforming machine elves" or elves with any other properties. Or just begin with the 100% comprehensive and full description of the brain state/circuitry generating the taste of vanilla, which would be distinctly differentiable from the state/circuitry generating a taste of chocolate or garlic.
