Nobilis: The Serpent Sleeps Beneath
Dream demons are a particular class of mythic spirit charged with protecting the dreams of the world. They operate (loosely) under the command of the Power of Dreams, whomever that may be. Like all mythic spirits they don’t generally interact the prosaic world, though when they want to talk to a regular mortal they can manage by drawing them into a ‘daydream’ (a specialized dreamscape that the dream demon has made their home).
Dream demons spend most of their time living inside the mental landscape of one person or another. Their primary function is to fight off other mythic entities(1) that might prey on dreams, but some of them also work to assist their host, according to temperament. Each person in the world doesn’t have thier own dream demon. They are more like cops, or maybe the Green Lantern Corps, in that the fact they might show up puts a chill on dream stealing, even if they can’t be everywhere at once. It’s hard to say how many there are, but safe to say probably at least thousands but probably not millions. Many of them have a specialty or particular type of dream they prefer to protect.
Dream demons can possess their host, though as usual in the mundane/mythic interface this mostly ends up with the same result you might get in mundane perception of reality. That is, a person seems to get all fired up and acts like another person entirely when under stressful circumstances. But not always. Because dream demons move around a lot and have to interact with many people and things, and because what goes on in a person’s head has so little to do with mundane reality anyway, some of them end up developing desires and agendas that might alter mundane reality. (This is why they are called demons, which is what you call spirits who don’t always do as they’re told.)(2)
Each dream demon is a unique individual with varying personalities, appearances, and modus operandi. Some of them are highly dedicated with a rigid sense of duty, some would rather avoid doing anything, and a few are corrupt and not doing their job at all. Some of them are even rogue cops who play by their own rules to get the job done!
Any dream demon can theoretically call upon the Power of Dreams for help (3), but they won’t usually do so unless facing miraculous (as opposed to merely mythic) opposition. The dutybound ones don’t want to be a bother, and the rest of them think that asking the boss for an audit is a bad idea. Most of them come back through Chancel Xanadu sooner or later, though.
(1) Or sometimes mortal sorcerers, or other stranger things. Dreams are a hot commodity!
(2) In case you were wondering.
(3) The Power of Dreams has a lot of inherited anchors.