Although the Dead Sea Scrolls include passages of Daniel, the passage 11:36 to end of chapter and the portions of chapter 12 that "predict" Ceasar Augustus to fall of Masada could have been added after the fact. In Pseudepigrapha, this happens often. Daniel as we have it today might not have been completed till 74 C.E. whereas most of it could have been written prior to 164 B.C.E. The Daniel myths could have been based on a historical Daniel and written as early as the Babylonian captivity. Although the Septuagint and Masoretic texts include the book of Daniel as we have it today, the earliest extant copy of those are still after the date in question. So therefore, the passage in question could have been written after the fact explaining how it seems to predict the future.
As for armies in the sky and phantoms, we might never know what they actually saw, and as for "witnesses" we have three historical accounts. The Talmud mentions it as well. Just another strange report, there might be a reasonable explanation. Take it for what it is worth, just a story. Josephus himself said it sounds like a fable, but included it in his Wars of the Jews because credible people witnessed it. Credible to Josephus that is.