In science fiction, fantasy, and some types of horror, it is really really important to establish the basic rules of the setting. The weirder the setting, the harder it is to work with, IME, and the more time you spend trying to get the reader up to speed without infodumping.
If a dream is done properly, it's a weeeeiiird setting. Objects are there only when they're noticed. People appear, disappear, and turn into different people without necessarily alarming the viewpoint character. Anything written down changes the next time you look at it.
So, your reader is going along trying to pick up the rules of this bizarre world—which is a different kind of reading, IMO, than that nice light adventure you take to the beach. They're concentrating. They're watching for context clues. And then *poof* the viewpoint character wakes up.
The obvious reaction is, "You cheater!" There is no world to figure out; there was no underlying logic. Now they have to reset, to start the story over again, in a way. And if they kind of liked the dream universe, too bad. It's gone.
Izunya