Even if I disagree with some of her conclusions, Ms. Tsukiyo is a pretty reliable source for stories.
A monk’s life is spent focused on perfecting the soul; sects differ in what this means, but in both Ms. Tsukiyo’s understanding and mine this is about apprehending absolute reality. This means not only seeing but internalizing the illusory nature of this life we lead as “separate” beings. Seen this way, the general is merely threatening to return the monastery master to what he has always been from the beginning. It’s not much of a threat.
Really getting there is hard, though. Notice that the one remaining calmly is the monastery master, not his disciples, and also that this seems to be the first time the general (who presumably travels plenty) has met such a person.