In this particular novel, reality vs. illusion is a raging battle in one man's mind. Most importantly, he is faced with deciding whether or not the murder of the old woman was, in fact, wrong. Throughout the novel, he never admits that the act was a crime; he does at one point admit it was a mistake but follows it with a declaration that he would do it again if given a choice. Therefore, it is up to the reader to determine which side of this internal argument is the reality, and which is illusion.
One side of him claims that the law is reality, and because it is against the law, murder is wrong no matter the circumstances hence his sporadic, but obvious, guilt. Also, murder is commonly perceived as morally wrong to society further supporting that Roskolnikov is lost in illusion and gone from the truth that laws and morals uphold.
However, he also believes that by murdering the pawnbroker he bettered the world. For all we know, this exception might actually be reality and society is stuck in the illusion. It could be that it is the morals and laws only blind people from reality, which Roskolnikov believes is that certain people have a right to murder if it is for the good of all mankind.
Crime & Punishment certainly blurs the usually straight lines between illusion and reality and forces contemplation regarding right and wrong. The truth is that no one can ever fully know the difference-human nature can never be completely evaluated and defined; much like illusion and reality reveal in Crime & Punishment.