This is certainly a valid philosophical point of view.

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There are so many philosophies though. Which one is correct?

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Life might be a dream. Then again, it might not. Dream or Reality, it amounts to the same thing, doesn't it?

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Personally, I don't think we are all One. I think this idea is just the 21st century ego, inflated with more power (thanks to our modern living) than any human has known at any other point in our history, yet knowing deep down that it has no power. Isolated even as we are interconnected, we seek to solve our problem by believing in the idea of Oneness. It is very gratifying to secretly be God.

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But it is all speculation without proof. Unless you feel you have proof, in which case, I congratulate you.