That's kind of what I've been trying to figure out: when people say they count sheep, do they close their eyes and literally see sheep jumping over a fence as if watching a movie or wearing a VR headset? Even in low resolution... That would be pretty impressive... why would we still need movies and games then? ;)

Of course I can imagine sheep jumping over a fence, even in vivid detail, but this imagining is not really seeing visually like in real life, not even like in a dream. As I said, I would describe seeing things that aren't there (with closed eyelids or not) as hallucinating. Perhaps not being able to do that at will is aphantasia, I don't know, but it would blow my mind if it were

Generally when I’m idly visualising something it is ‘in my mind’s eye’ as you put it. But if I’m really focused and close my eyes then everything else seems to disappear and I’m ‘really’ seeing it, not on the inside of my eyelids but it encompasses my entire visual perception if that makes sense

More rarely I also get it with sounds and then it definitely does feel that the sound is originating externally to my mind

You’re right that these experiences are more like hallucinations but I think they are points on a spectrum rather than separate things