I think the story is about struggling with social interations and fearing the world outside. Embry is a kid afraid of the world and the people in it (maybe because of a bad experience with the outside like bullying), and has locked himself in an imaginary bubble to isolate himself from all if it. He then created a routine to set a goal for himself without having to truly go out. The basement represent the way out of this bubble, and that's why Embry is afraid of it. So he created the whole monsters and feeding deal to distance himself from the problem, stating that the basement itself is the problem. The food represent Embry's denial, and it slowly running out represent Embry who is slowly realizing that he is getting nowhere with that.
Embry's parents fate isn't clear, but if I go with the story not being real, I would say the parents's absence represents Embry shutting himself from the world. We only see the parents two times, and each time they are educating Embry. But those advices they give him are always related to the whole basement deal. His mother tells him he need to bring constant care in order to keep the plants alive, and his father tells him his paint give him an anchor he can always go back to when he's feeling down. The fact that we have no other interactions with them signify Embry discarded everything else and kept only the advices reassuring him about his situation, interpreting those to feed his denial. He works to keep his routine alive, and said routine give him comfort about himself.
Then there is the basement scene with the parents calling out Embry. I think this represents their efforts to get Embry out of her bubble. The mother try a gentle approach as to not scare Embry, but it doesn't work. Then the father try a harsher approach, but Embry doesn't listen yet again, denying the whole thing as "monsters" trying to bait him. Then his own voice come from the door. This is his own subconscious calling out, showing that Embry actually wants to get out, but his fear of the outside won't let him do that.
People at the market are just worried about Embry, but he keep pushing them back because he clings to his routine. The doctor represent someone kind enough to actually go out of his way to help him. On the way home, Embry keep trying to shoo him away, but he won't leave. I think the doctor falling in the basement is way more than that. For him, the basement represent nothing, but he see that Embry is deeply afraid of it. Embry throws a tantrum when he insists on going in, and him falling into the basement represents not his death, but him finally giving up after Embry violently pushed him back and taking his leave.. Hence why Embry is crying after his departure : he wants to be helped, but is too afraid of leaving his bubble. A small detail being that he cries until his routine calls him back, his line sounding like a premade routine line ("Look at that, it's time for bed already").
The nightmare sequence is Embry's subconscious confronting him, and presenting him with 2 truths represented by the monsters he so dread. The monster in the basement in the routine incarnated as Embry himself. He created this monster, and the monster feeds on his denial, never having enough, and it will consume her over time while Embry is using it as a scapegoat to avoid confronting the truth. The doctor represents his guilt about making him leave. He warns Embry that if he keep on pushing people back, they will ultimately stop trying, deeming Embry as not worth the trouble. And then, no one will come to help anymore, represented by the faceless visage under the mask of the doctor, and loneliness will consume Embry.
Finally, after this nightmare, Embry realize the truth, and declare that all of this has gone far too long. At this point, there isn't any food left, and thus no more denial. Embry finally find the will to enter the basement, and by doing so, leave his bubble and is off to live his life.