Hi :) Thanks for the question. My main intention with the dream magic is that it helps to open up your subconscious in a way that hopefully enhances the rest of the experience. I wanted to create a very open imaginative sandbox, and things like dream fragments are there to provide imaginative "playing pieces". It's up to you how (or if) you want to make use of them. Even if you don't use them directly, I hope that the act of imagination involved will help to colour and shape the other events of the day. The "Fireside Work" phase of the game loop is intended to be the most open phase, where you can look back and contemplate what has happened during that day. I have thought quite a bit about how I might expand the magic / dream magic systems of the game, but I am reluctant to make them too concrete or mechanical, for fear of limiting what I think has the potential to be one of the most personal and meaningful parts of the experience. On a practical level, I suggest asking yourself how those dream passages made you feel on an emotional level. If the emotion was positive, cast dream magic to enhance that positive feeling. If the emotion was negative, cast dream magic to transform that feeling, or its source, into something non-threatening, or even better, into something positive. As you form a relationship with the Forest, you may find that this dream magic has a more powerful effect than you expected :)
Thanks for playing :)