Sitting in Tripoli is to be disconnected from reality. There is the propaganda effort from Colonel Muammar Gaddafi's regime that sometimes would verge on the ridiculous if the situation were not so tragic. This is a phenomenon that has been well documented by the media camped here at the regime's invitation.

But there is another disconnect. What you read of events often close to the city, filtered through opposition voices, is frequently equally as misleading, creating an impression that has crept its way inexorably into the international media. Pitched battles are described breathlessly as if they were major confrontations – tanks on tanks, brigade on brigade, with the buzz of aircraft always in the air, swooping in to bomb.

In the town of Zawiyah last week – "the key town of Zawiyah", as it has become – a few hours of skirmishes that left a handful of dead was transformed via this prism into a confrontation between two sides armed with tanks. I have read of helicopter attacks on civilians in neighbourhoods of the capital; the bombing of outlying towns. Yet – for now at least – I have not found evidence of it. What I have found is serious enough. Opposition supporters in a government-controlled town who say they are fearful of their lives if they speak out, and the graves of those killed fighting in Zawiyah.

It is true too there have been more serious clashes in the east of the country, and air raids witnessed by my colleague Martin Chulov. But still there is much about this narrative that does not feel real.

I read, for instance, that Gaddafi is dug into his last stronghold of Tripoli with the rebels advancing on every front. Yet when I drive out into the towns around Tripoli, I find a different picture. Towns are changing hands, it is true. But this is not a war of movement if, indeed, it is really yet a war at all, despite the impression being given. Traffic is moving on the roads. Even in the parts of Zawiyah not held by the opposition there are shops open and people walking on the streets.

The much-vaunted notion of imminent civil war appeared to be challenged on Sunday when government minders, searching for journalists who had gone to meet the rebels, wandered among their opponents unmolested wearing their government press jackets.

There is another disconnect in all this. I read about advances and possible outcomes as if this were a war between two states, or a civil war already well advanced. Instead it feels – at least from where I am viewing it, and that is an important caveat – like a civil insurrection with moments of sometimes serious armed violence.

So here is the reality. Gaddafi can no more quickly attack Benghazi with his armour than the rebels can advance on Tripoli in sufficient numbers to force the issue decisively. For either side to move the hundreds of kilometres to come into contact would require a huge logistical operation using tank and armour carriers which could not drive the long distances and still be ready to fight.

Why this matters is simple. Foreign policy – including the increasing threat of military intervention – is being driven by what the media is reporting from Libya, and that is being driven largely by reports from the opposition, some of which are true, some of them dubious. The Libyan government says that. But for once, in the midst of all the regime's evasions, lies and fantastical notions, it may just have a point.

We are being drawn into a crisis where credible information about so much of what is happening is not simply at a premium, it is often impossible to mine from among all the exaggerations and misinformation. If proof of this were necessary, it was provided by the foreign secretary, William Hague, when he announced he had information that suggested Gaddafi had flown to Venezuela.

The reality is that we are rushing to make policy on Libya without knowing precisely what is happening here. That is not to say we do not know some of the broad details. Yes, people are being killed for demonstrating against the regime. People, too, are being taken from their homes amid a widespread policy of intimidation. Human rights abuses are unquestionably being committed. But it is a question of scale. And there is a requirement for a response that fits the reality of what is happening and does not exacerbate the country's problems, or the region's.

We should admit our ignorance and own it as we try to determine what is happening in Libya. When we have determined the reality of what we are dealing with then perhaps, and only then, can we talk seriously about appropriate measures to respond to it.