While Theravada Buddhism focuses almost exclusively on the Buddha as a human being who taught a method for attaining enlightenment, and while it has little room (except in various forms of folk practice) for the worship of spirits and gods, Mahayana Buddhism has an elaborate pantheon of spiritual beings who are the object of worship and devotion. Theravadins typically conclude that this is a feature of Mahayana that demonstrates its divergence from the teachings of the historical Buddha, who refused to discuss such matters.
Mahayanists, on the other hand, assert that the existence of such beings is implicit in basic Buddhist teachings, and that the rejection of them shows an excessive attachment to the phenomenal world of ordinary reality. Mahayanists argue that buddhas and bodhisattvas occupy various realms of existence. These are described in various ways. One way is to describe "three bodies of the Buddha" as a metaphorical way of describing all reality. The three aspects of the trikaya ("triple body") are:
As for the nirmanakaya, there can be no doubt that the Buddha lived and took such a human form. But the Buddha himself said that no one should become attached to his physical form, but rather to the more eternal aspects of his being, which is in his teachings. So, the Mahayanists would argue, there is no special need to focus on his specific historical form to the exclusion of considering other forms that the Buddha nature might take. Of course, Shakyamuni Buddha (i.e., the historical Buddha) is highly revered in Mahayana Buddhism, and the form of the Buddha in the nirmanakaya is quite important for them. Shakyamuni Buddha is that specific phenomenal being who brought Buddhism as we now understand it into the world, and his teachings are accorded the utmost reverence. Still, this is only a limited aspect of reality.
And as for the sambhogakaya, Mahayanists would argue that this is merely the realm of spirits. Mahayanists have no trouble acknowledging that spirits exist -- in contrast to Western materialists, for example -- but by the same token they do not regard the realm of the spirits as their ultimate goal. Spirits are more powerful than humans, but they are subject to the same features that plague all conditioned beings. Some spiritual beings are pictured as being in need of instruction, because they are deluded about the nature of reality. However, celestial Buddhas and Bodhisattvas (such as those mentioned below) have both the powers of spiritual beings and the insight of fully enlightened beings. As such, they are able to help lesser beings (such as deluded humans) to overcome their confusion and suffering. Within Mahayana Buddhism the reverence for these beings is quite important, but their being is by no means considered as "ultimately real". They are still subject to the constraints of all aspects of being in duality (e.g., they are empty, dependently co-arisen, and must obey the laws of karma).
Still, many students have asked me over the years, "Yeah, yeah, but are they real?" Well, the answer to this question is rather complex. Since Buddhist views about individuated existence are that every individual thing is illusory, then spiritual beings are illusory, too. The really interesting question is to return to the most basic question: What is real? This is best understood with reference to the Buddhist concepts of sunyata and pratitya-samutpada. But, if every individuated being (such as you or the book in your hands) is only provisionally real, a metaphor, so to speak, a trick of the mind that we use to get through the day, we must ask whether the tricks of the mind that we use to describe objects in the nirmanakaya are any trickier than those we use to think about the sambhogakaya.
For my part, reflecting on the sambhogakaya has given me conceptual tools that are very useful when considering the existence of Gods and spirits from any tradition, particularly in my own attempts to understand various religious traditions with sympathetic detachment.
When I have asked Buddhist teachers about their understanding of karma and rebirth, for example, they have answered in a very simple, yet straightforward way. They have said, if the idea of rebirth is a problem for you, don't worry about it. Consider only the problem of karma. Isn't it clear that actions have effects? If you beat a child, won't it suffer and won't there be effects on its psychology in later life? On the other hand, if you love the child, isn't it equally clear that there will be effects, but different ones? This is the heart of karma. Now, as for rebirth, Buddhists only claim that might differ from common sense opinion in the materialistic West is that the causal effects of actions carry on past death through reincarnation in another birth. But, from the Buddhist point of view, the most profound philosophical puzzle about our identity is not whether we were born to another life previous to this one, nor whether we will live again in some later reincarnation, but whether there is any reality to our belief that there is a self at all which continues to exist from minute to minute to minute throughout this one life. Once we accept the grand illusion of our self as this independently existent, lasting being, what's the big problem with accepting another metaphor about the transmission of karma to a next life?
Similar reasoning can be applied to the problem of whether celestial Buddhas and Bodhisattvas actually exist. Do they really exist? No, not in any absolute sense. As with all reality, the existence of such beings is metaphorical and illusory. However, there is still the question of whether these beings are mere fictions, or whether they have reality on some level more significant than mere imagination. Well, let's follow the same approach that we might take to karma. Consider compassion. Don't we all understand that acts of compassion are a powerful force in our world? Who would deny the importance of a mother's love, for example? Or, the acts of caregivers who devote themselves to victims of war, starvation, and disease? Are these acts themselves real? Well, yes, but not in any ultimate sense, from the Buddhist point of view. Or, when we consider each of these acts in isolation, it is clear that they are real in some sense, but can we conclude from the existence of individual acts of compassion, that there is any reality to the general concept of compassion. Can we with any sense of intellectual honesty recommend compassion, or love, or decency, or justice, as general principles? Most of us do think this makes sense, even if we are cautious about the philosophical implications of saying so.
But let's go just one step further. If we accept the first principles of Buddhism (particularly those in the 3 Flaws, sunyata, and pratitya-samutpada), then we recognize that all constructions of reality are more metaphorical than real (as if such a distinction could be maintained). It's not so much the truth of a metaphor metaphysically that is important, but its usefulness that recommends it. If by focusing our attention on the beings of the sambhogakaya we can improve our wisdom and compassion, why should we dispute the metaphor? The Mahayana tradition has a long track record of people who have attained great heights of moral and spiritual development, and many of them have attributed their success to practices devoted to such spiritual beings. It might be argued that the existence of acts of compassion that arise as a direct result of devotion to Guan-Yin is a sufficient demonstration of her existence.
If at this point you still ask, "Yeah, but does she really exist?" I would have to ask again, "Do you?"
Some important Celestial Buddhas and Bodhisattvas are (see Noss, 197-200, 205-206):