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In the rapidly evolving field of applied artificial intelligence (AI) for materials science, benchmarking serves as a cornerstone for evaluating model performance and guiding research trajectories. However, this paper advances a conceptual critique that unveils the inherent illusions embedded within conventional performance comparisons, which often obscure the nuanced realities of materials discovery and prediction. By synthesizing recent literature, we highlight how benchmarking practices can perpetuate misconceptions about model efficacy, generalizability, and alignment with real-world materials challenges. The critique centers on the interaction dynamics among data representations, evaluation metrics, and contextual factors, revealing feedback structures that amplify epistemic distortions. We propose a novel conceptual framework that reinterprets benchmarking as a multi-layered system of steering logics, in which trade-offs among precision, robustness, and interpretability shape the interpretive landscape of AI-driven insights into materials. This framework emphasizes systems-level insights into how illusory superiority emerges from mismatched expectations and overlooked interdependencies. Through analytical implications, we explore how recalibrating these dynamics could foster more transparent and ethically grounded performance assessments. Ultimately, the paper advocates for an integrative approach that prioritizes conceptual interpretations over superficial metrics, offering epistemic reasoning to navigate the complexities of materials AI without succumbing to benchmarking illusions. This conceptual reevaluation has the potential to refine the field's theoretical underpinnings, promoting advancements that are both innovative and reliable.