Yeah, I think I've got your impression of the term "illness". Typically speaking - yes, it's pretty stigmatized. So I've lately started to pull away from using terms such as "illness" or "disorder", and have began to use the term "condition" more.

However though, considering the latter - I guess the person who provided the "definition" is saying that you could be in some beautiful, peaceful environment on a sunny day, but your mood/perceptions are in an unusually painful state. In a general sense - the circumstances you're in seem to be incongruent to your mood, so it doesn't make much sense or, there seems to be no concrete reason for why you feel the way you do, that you just can't "lay a finger on". Nonetheless, I personally didn't take that Urban Dictionary statement in a literal sense.