From what you wrote, I would conclude that iPads and iPhones are merely viewers of the photo content in iCloud.
However, when you take photos or "import photos" to a device, those photos take up physical space in the device, do they not? I mean, when I sync and backup my devices to either iCloud or iTunes I can see graphically and numerically how much space the photos are taking on the device. So to me, that means there are physical "photos" stored on the device; they take up space. And, if I understand further, if I delete those photos physically residing on the device, they will be deleted from iCloud as well. This is what I find hard to understand, which is "why?". Do you see my difficulty?
I also know that one can choose one of two qualities of photo to store on the device, full resolution or "optimized" for the device to save space.
I would have expected the OS to *duplicate* the iCloud-stored photo on the device because it is *initially* saved in iCloud...and let a person delete stuff from the device only, or iCloud only, or both.
I have read iCloud Photo Library FAQ - Apple Support.
and I am still confused, but can move on and work with the limitation as best I can.