This is all the more confusing when people say "play D dorian over Dm7 and then G mixolydian over G7"
It's only confusing until you grasp that you are simply playing diatonically. You can think of it as all the notes of the C major scale or you can break it down into the individual relative modes. It's just different ways of thinking about the same notes.
IMHO it's actually a good idea to use multimodal learning: Learning the same information in different ways. An advantages of multimodal learning is each person has a different way of thinking. The point here is the best way of thinking about music for you may not be the best way of thinking for someone else.
IMHO, an important distinction is you play a D Dorian box shape over Dm7 (ii), rather than simply playing the Dorian mode. In other words, you don't necessarily start on D or play D,E,F,G,A,B,C. As @Whousedtoplay showed, it relates more to understanding the shape of the D Dorian fret box, so you can shred without actually thinking about all of the notes names.
What you play may even be closer to a different mode. For example, maybe you will use the Dorian fret box, but play a linear line up from F...meaning the notes you play resemble F Lydian more than D Dorian. But none of the listeners will be aware of your mental process anyway. They will only hear the notes of C Major, regardless of how you think about it.
Do I use this approach when playing? For the most part no, at least not on a conscious level. But I used to practice the standard modes. I did it two ways. Some times I would pick a key and play through the relative modes. IE, in the key of C I would play C Ionian, D Dorian, E Phrygian, F Lydian, G Mixolydian, A Aeolian, B Locrian
Other times I would pick a note and play through the parallel modes. IE, C Ionian, C Dorian, C Phrygian, C Lydian, C Mixolydian, C Aeolian, C Locrian. You can relate each mode diatonically to it's relative major key, or you can think of it i terms of the fret box shapes that is used for each mode. You can also sort the modes into mostly major or minor shapes and think about how they vary from the major or natural minor scale. For example C Dorian is the same as C natural minor with a major (raised) 6th. C Mixolydian is the same as C major with a minor (lowered) 7th.
For me, the idea was to learn the keys inside out by studying the shapes and sounds of the modes. It was about training the mind, ears, and hands, and not just a mental exercise.
I wouldn't say I ever mastered modes, but do believe my study of modes was worthwhile and helped me to become a better player. While I don't usually think consciously about modes when I am playing, I am confident that practicing them shaped the unconscious processes I use to play. So in this context, I do use modes, I just don't think about it.