A realistic dildo is a dildo that is particularly phallic in nature.
It tends to be modelled after the basic shape of a human penis, characterised with a fairly uniform shaft and pronounced head.
Additional features often include veins, balls and sometimes a colour which is of some skin-toned variety, but these are not absolute necessities for a dildo to qualify.
So, why are they so great?

Lifelike Sensations
Along with a natural shape comes a more natural feeling than with more zany designs of dildo.
These other shapes and styles are great too (I have never met one I hated!), but some days, your body craves something a little more natural that can sate your needs in the way an actual human would.
This natural feeling particularly lends itself to fantasies and imaginary scenarios, especially if they involve someone you know - it makes the fantasy all the stronger if you can feel a realistic shape inside you.
If this person you are fantasising about is your actual partner, or at least someone who you very much trust sexually, you could even consider making your own realistic dildo with a Clone-A-Willy kit!
Plus, because of the extra textures on the veins of the shaft and balls, you can benefit from additional stimulation (both inside and out) that you don't get with a smoother toy.