However, is the world that people perceive, and the appearance of things they see really the truth? Or perhaps it's just an illusion. That's the interpretation of the first half of that sentence.
As for the latter half, the 'emptiness is form', it means don't be misled by these outer appearances, look for their true nature.
Now, the sole effect held by this complete title, the 'Eye of Emptiness', has indeed validated this interpretation. If nothing goes wrong, this 'Eye of Emptiness' should be able to see the true nature of certain things, or even something deeper.
Lin Yi's gaze landed on the Eye of Emptiness, and saw a line in small print, "Using this ability allows to see through the essence of things (consumes spiritual power)."
A look of surprise and elation appeared on his face. As he expected, this ability enabled him to perceive the essence of things.
This ability is certainly not just an upgraded version of the Spirit Wood Technique, but can play a much greater role.
