Reality deniers deny that they are reality deniers. It seems like an obvious statement, but it gets to the essence of how people continue denying reality in the face of overwhelming evidence. Denying reality becomes a way of life. You grow up being told things you initially question but give up on asking about. You soon only accept information from people who you respect. The list of people who you respect becomes smaller until you only accept that which you already believe. An unquestioned belief is an unquestioned life.
Dealing with reality without reality denial is difficult. Denial is the first stage in dealing with grief and loss. Humans are almost wired to deny reality they dislike or is difficult to accept. To accept reality is to accept the good and bad of reality. If you only accept the positive parts of reality, you are not accepting reality. Reality is full of death, bad behavior, terminal illnesses, and ugly truths. Ignoring those ugly truths only makes them worse. Horrible things that happen in life must be dealt with realistically. Your mental and physical health cannot hide from the reality you deny.
Some realities are invisible and easy to ignore. You can ignore the pain you live with on a daily basis because you do not see the pain. The pain can go away for a time and it disappears from your memory. You can also become so used to the pain you have to ignore it to get through your day. Emotional pain is even easier to ignore because the cause of the pain is hidden. The cause and effect are separated and can be disassociated from one another. Emotionally abusive parents can be many times more damaging to a child than a physically abusive parent. Both parents deny the reality of the damage they are doing to their children.
The biggest villains in fiction are basically the biggest reality deniers. Lex Luthor, Darth Vader, Nurse Ratched, and Mr. Burns are all reality deniers. None of them are happy and most of them are not healthy. Most of them are under the mistaken impression that power and wealth are the only goals worth having in life. Happiness and health are only considerations when they interfere with their ability to gain more power or wealth. Villains, in reality, are people who never learned how to deal with reality in a constructive way. They created their own realities and ignored the reality that other people exist. They never truly get what they really want which is respect. The hero gets the respect because he or she helps other people and deserves respect. The villain gets no respect because the reality is he or she does not deserve it.