Twists and twirls
I have an ambivalent relationship to the human mind and psychology. A lot of it is impressive and mind-boggling. But the very same mechanisms produce so much of the stupid, ego and power mungering in the world that endanger us as a species.
Beyond our understanding

But to others a self-imposed reality distortion is triggered, in the sense that if they don't understand it, it cannot be true.
This is likely relates to the Dunning-Kruger effect. A psychological theory outlining what happens when a person is literally so stupid that they don't know realize how stupid they are. In effect creating a superiority complex in which they are smarter than anyone else.
I promised myself not to bring Flat Earth up in this post, but it's a gold mine of examples. Let me start by saying, though, that not every Flat Earther has lost their minds. Many, but not all. As mentioned in an earlier post, I believe many Flat Earthers are more concerned about untrustworthy governments than the shape of the Earth.
But let's move on. A common argument in favor of Flat Earth is the disbelief that we're living on a ball flying crazy fast through space. It's reasonable to find this mind-boggling and weird. Even to say "it's hard to believe". But, for me at least, there's still a lot of room from that to calling it a lie and a conspiracy. Yet, this is sometimes all it takes. Back to the: "I don't understand it, so it's not real."

It's important to underline that I'm definitely not advocating that we blindly trust a source, just because they talk about something we don't understand. Critical thinking is more important in our times than any other time in history, because of the massive influx of fake news. But it's also important to think critically about your own critical thinking. If you refuse to accept something entirely based on the inability to understand it, I would say you're not applying your critical thinking the right way.
Constraints

Even the most stone-cold logical minds cannot picture how the Big Bang started the universe. We trust the math saying it's how it went down.
But that's not even the kicker. For Big Bang to find place, all the matter in the universe had to exist, and to always have existed. No matter, no Big Bang.
Basically, this means every basic particle has always been around. There was no creation or beginning. They were there, no matter how far back you look.
When I first realized this, it made sense on a logical level. But I couldn't push the idea through to my imagination; It just didn't fit.
Even to this day only my logical reasoning accepts that maybe there was no beginning. But I've also acknowledged that I will never reach a point where my more emotional and imaginative sides can incorporate this concept.

The same goes for the question of "what's on the other side of the edge of the universe". It's hard to imagine an infinite universe, but it's maybe even harder to imagine that there's actual nothingness on the other side. Because, surely, there has to be something?
You know where I'm going with this. The culprit of the sentence was "surely". Because again, our imagination or comprehension don't change the reality. Maybe it's infinite, maybe there's actual nothingness. In either case, we cannot picture it.
I think this point ultimately proves that our understanding isn't the limitation of reality. Because either scenario is hard to believe, but one of them have to be true. There's no third option (Unless that would be a option we are unable to think of).
The Matrix argument

Okay, yes, that's possible. Maybe we do. But so what? Whether our world is real or a simulation there's still a clear set of cosmological and physical laws governing it.
Imagine a video game. It's called "The Universe Simulator" (it's not a good name!) Someone programmed the game with a set of rules that brings life to the game and sets up boundaries for what you can do. For instance, you are not allowed to leave the game arena (i.e. the Universe).
If the characters in the game had the ability to think conciously about their existence, then what really changed? To ask whether they were living in the real world or a game. The rules are the same. The sun rises and sets. Gravity does its thing. You're killed if you loose your head (probably).
It's not a correct or natural conclusion to make that our laws aren't truly in place, just because we might live in a simulation. So unless that's what you're debating, stop using this argument just because someone backs you into a corner.
In conclusion
We are nothing but one of many lifeforms on a globe, in our corner of the universe. Most lifeforms struggle to survive. They are either hunted or hunters. On an astronimical scale humans barely just started to think and talk. How can we possibly have evolved the mental capacity to grasp a world that's so large we don't even have words that encompass its size?
Our mental constraints don't make everything outside of our understanding false and non-existent.
Take off the mental shackles to truly appreciate the magnitude and beauty of our world. You don't have to understand it. Just let it blow your mind away, again and again.
And remember that you also have to be critical of your own critical thinking. You have to keep it in check. It's such an important asset in this world.