Hallucinating would be too strong.
I would compare it rather to something like this. When you read you actually don't read letter per letter. You read what your brain interprets it is written based upon its stored data of words you already know. Sometimes even the brain makes mistakes. Hence you mistake one word for another.
The sam egoes when you speak. You actually don't speak in a broken up manner word per word, but segment per segment. For example when you say "get up", it doesn't sound as two words, but as one, even though two words are written.
Here is a text, try to read it quickly. Apparently only 55/100 people can read it quickly. This might explain why the opinions on the Cascio tracks seem divided at such extent, all is a matter of how your brain analyses the letters, the sounds, and the reality around you:
I cdnuolt blveiee taht I cluod aulaclty uesdnatnrd waht I was rdanieg. The phaonmneal pweor of the hmuan mnid, aoccdrnig to a rscheearch at Cmabrigde Uinervtisy, it dseno't mtaetr in waht oerdr the ltteres in a wrod are, the olny iproamtnt tihng is taht the frsit and lsat ltteer be in the rghit pclae. The rset can be a taotl mses and you can sitll raed it whotuit a pboerlm. Tihs is bcuseae the huamn mnid deos not raed ervey lteter by istlef, but the wrod as a wlohe. Azanmig huh? yaeh and I awlyas tghuhot slpeling was ipmorantt!