Hmm...actually, a member here (Dexing) had written to me:
It is like mistaking a rope for a snake. The rope is the basis for the imagined snake. If there was no rope, no imagination of a snake would arise. Emptiness in this sense refers to the non-being of the snake, which is merely the appearance of a rope.
But, you must then see through the existence of the rope as well. The snake is that which is not existent in any way. The rope is only conventionally existent. Both are ultimately empty.
This can be applied to the imagined nature (snake) imputed upon the dependent nature (rope). When the latter is made free of the former, a realization of the original perfected nature takes place, and the conventionally established 8-fold consciousness is transformed into original 4-fold Wisdom.
That original wisdom may be equated with that often spoken about "luminous mind", or Tathāgatagarbha. But it is not a "mind" as in the 8-fold consciousness, with the aggregates and so on.
The transformation of consciousness into wisdom is like melting ice into water. The original nature of both, the H20, is never more or less present. There is simply a qualitative change, as one realizes the form of a dragon— in an ice sculpture— is only imagined (imagined nature), dependent upon the ice (consciousness/ dependent nature) which was only conventionally appearing. There was only water (wisdom/ emptiness/ perfected nature) all along.
Perhaps not the best analogy, but it expresses the meaning that wisdom is original and not produced by transforming consciousness.
Consciousness is the level of ordinary beings, where actions are led by volition, one of the aggregates. Being "volitional action", they create karmic debts which bind them to cyclic existence. Whereas the actions of a Buddha are led by pure wisdom and are spontaneous, not "volitional".
So in regards to your story from the Perfect Enlightenment Sūtra, this is saying the same thing. If the Tathāgatagarbha is not understood through emptiness, then one equates it with a mind like the 8-fold consciousness. In fact, it just becomes an object of consciousness (an idea) which would be false, and subject to change. This is not the way it is.
If one truly sees the Tathāgatagarbha, then it means they have understood emptiness. Having thus understood it, the basis for defilements and such would be cut off forever. It is like one who believes there is a snake and acts irrationally, when in fact there is only a rope. Once one sees the rope for what it is, then the image of a snake will never again appear.
Of course, in Yogācāra, we must take a step further and see that even the rope is only conventionally existing. Then the rope will never again appear either. We are then left with the originally bright luminous mind endowed with the 4-fold wisdom, and can function spontaneously from there to liberate all living beings.
So if we take the snake to be the imagined nature, and the rope to be the dependent nature... once the latter is free from the former, you are left with the perfected nature which is the fourfold wisdom, correct? But then... this fourfold wisdom, how is it suppose to be understood, through emptiness as well? Ah! I'm confused...
Then really the 'true mind' has to be understood through emptiness the way that the Madhymakas convey Ultimate Reality then? Arising through pratityasamutpada and is conventionally existing?