The truth about Madonna's "Confessions On A Dancefloor" era:
It's based on a 1974 rock-and-roll drug movie called "Tommy."
Tommy is the fictitious biography of Tommy Walker. Tommy's father, Captain Walker, had been listed as missing in action during World War I, but he returns unexpectedly in 1921 kills his wife's new lover in front of the seven-year-old Tommy. Tommy's mother and father say to him that "you didn't hear it, you didn't see it ... you won't say nothing to no-one", and Tommy retreats into deafness, dumbness, and blindness as a consequence. He has a vision of a tall stranger dressed in silvery robes with a golden floor-length beard, and the vision sets him on an internal spiritual journey, learning to interpret all physical sensations as music. During the remainder of his childhood Tommy's parents seek out various treatments and cures for him, while Tommy suffers sexual and physical abuse at the hands of several extended family members. On Christmas, his parents despair about the fate of Tommy's soul, as they realize he is unaware of Jesus or prayer. However, Tommy learns to play a pinball machine and soon becomes the master of the game and an international celebrity. His parents eventually locate a doctor who promises a "miracle cure", but all tests indicate that Tommy is actually capable of sight, speech, and hearing, and that his condition is due to an "inner block". Tommy is finally cured when his mother, frustrated that Tommy seems only to see his own reflection, shatters the mirror in a fit of rage. Tommy's cure becomes a public sensation and he attains guru-like status. Thereafter he assumes a quasi-messianic mantle and tries to lead his fans to an "enlightenment" like his own (requiring followers to play pinball while wearing eyeshades, earplugs, and a cork), but the heavy-handedness of his cult and the exploitation of its followers by his family and associates causes his followers to revolt against him.
How "Tommy: The Movie" relates to Madonna:
Storywise Tommy is much like Madonna's life, of course not literally but you'll know what I mean. Madonna has said time and time again that she was "trapped" in a certain state of mind, obsessed with the superficial aspects of life, glamour/fame etc, etc. Battling with her own religious demons, dogma's and questions. Then after releasing herself from the "inner block" she found hapiness and was "cured" of this mindset (thanks to kabbalah? ). She then set about to share this enlightenment with others (promoting kaballah in various ways, among them the "American Life" album) becoming a public sensation and getting guru-like status for her own "cult" with "merchandise", books, red string etc. But then due to the money factor and people getting sick and tired of the overkill of indoctrination and focus on that aspect of her life people started to revolt and call what she considers her saviour a cult and craze and question her sanity. I think Madonna's use of the movie "Tommy" is a sarcastic comment and view on what happened to her the last couple of years before "COADF". How many times has she not said that "she's been blind, but now she has seen the light", JUST like Tommy.
She visualized it by using several style elements from the movie Tommy, in which you can see tommy and his mother for instance going from church group to church group (one even adoring and praying to statues of Marilyn Monroe), seeking refuge in drugs (the acid queen), and eventually Tommy starting his own cult based around pinball, using that pinball as a trademark sign used in "religious symbols", merchandise etc, etc. You could even go as far as to say that the discoball she is holding in several shots is a refference to the pinball Tommy is holding and adoring in "Tommy".
Here are some visual relations between the movie Tommy and the COADF artwork:

pinball versus discoball on display

Tommy can only see his true self in the mirror, but it's also his "cage". The position of the mirrors for the COADF shoot is an exact replica of certain shots in the movie "Tommy".

Tina Turner as the acid queen, Madonna in the exact same outfit, also dancing wildly. Also, the handwriting on the tina turner single cover is similar to "Confessions on a Dance Floor".

In the movie a mirrored effect was used in certain scenes, which was also used in the LIWB footage for the Koko performance