Writing dream sequences is something that's likely to kick your butt. However, you did great. It actually felt like a dream (now don't ask me to explain that, I can't; that's just how it felt - dreamy).
All in all, good chapter. It's nice to see that you're trying to flesh out the characters and the world they inhabit, because that's become a such rare occurrence in fanfiction these day.
Patiently waiting for the next chapter. =)