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My World of the Paranormal
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Are they truly just the product of the human mind discarding useless information?

In some cases I would have to agree that yes, dreams are just mentally discarded images or discarded fragments of no longer needed information.  However, that's not always the case. Sometimes a dream is the only way that the human mind can adequately process information and the images we see are the bi-product to the information being presented.  Whether that information is a memory from a long forgotten past or something more psychic, one will never truly know for certain until the dream can be explored.
Scientists say that the human mind can only dream when in the REM state of sleep.  REM meaning  Rapid Eye Movement, and that most dreams physically only last for a moment or less but the mind makes the body think the dream is longer than just that brief moment.
I have personally learned that people who are prone to psychic events will often have some of these events manifest as a dream because often times that is the only way in which the human subconcious mind can communicate with the concious mind and actually make the concious mind listen to what the subconcious has to say.
A lot of people who are psychically sensitive don't always realise their sensitivity or are so busy in their waking lives that they aren't able to hear what their subconcious mind has to say.  When they are able to listen or their psyche forces them to listen to it, they often times become frightened by what is said that they think they have become ill and will seek professional help.  Trust me I'm oneo f many who has done so, until I began to take a better look at what was happening and accepted it.
Dreams don't always manifest in the sleeping mind though, they can manifest in the waking mind as well.  Thats where the term *daydreaming* got coined I think if memory serves me right atleast. Though sometimes daydreams like sleep induced dreams are simply useless bits of information being discarded.
Premonitions, post and pre cognition are forms of psychic phenomena that can happen within a dream or in most any other fashion that is likely to get the human mind to take notice of it and the information it's trying to present.  I have experienced quite a few forms of such phenomena, my most recent having been in a sleeping dream.
In this dream, I was seeing it through the eyes of a surgeon.  It was regarding a dear friend of mine and his wife, who at the time being was pregnant.  We were in the operating room and she was having the child prematurely.  In the course of her having the child I told her she was having a boy and that there were some complications, though the baby would survive, he would have a lifetime of other health complications.
Well oddly enough I had told my friend the next day about the dream, which I had the middle of last week; he had shrugged off the idea and even laughed about it so I followed suite. storing the information in the back of my mind and thought nothing more of it till earlier this week when he told me that his wife had went to the university hospital 150 miles away from their own home and that she was in premature labour.  She was 25 weeks along when this occured.  This had literally scared the crap out me because I knew this would happen to her and he had shrugged it off after my telling him it would happen.
Well a couple of days ago, she had reared a beautiful baby boy who weighed in at 1 lb 10 oz. and born 3 months premature.  From experience, most babies born that premature either don;t survive the first few days or if they do survive the first few days there will be a host of health complications to follow them around for the majority of their life.
Now tell me that isn't a bit creepy, or in the least a bit disturbing? While it has disturbed me to the point of thinking it was my fault this happened I also realise that it isnt my fault at all. While it had scared me that it had happened I am glad that so far everything has turned out well for his wife and child and I hope that things continue to go well for them.

A waking dream that has been sometime passed from a few years ago I feel may have potentially saved a life.
At the time I was engaged to a friend from Job Corps. We had a few stops and starts to our relationship to say the least. At the time he was living with some friends in Washington, Their apartment complex was near a railroad yard. which bothered me the most because of course in the waking dream I had, I had heard a man scream a frightened pained scream. it had been as I thought caused by a train accident as i had heard, up until the screaming man, a train going by. As most of us know trains don't make a clickety clackety sound anymore as technology has improved that.  So putting two and two together, the events afterwards started making sense.  As my fiance at the time, myself and our very close friend would drive areound, especially at night, he would have trouble seeing the road and would start swerving into the other lane, even with oncoming traffic. needless to say he got irritated with me insisting he went to get his eyesight check. He has since then found out he is night blind and cannot drive at night and can drive minimal in poor lighting conditions.  So score one for me and zero for the railroad tracks.

A bizarre dream to say the least. 
This happened to me a couple weeks ago actually.  In this dream I was travelling down a well travelled freeway with a male friend.  I had this odd feeling that either I was Elvis Presley, later to show I wasn't, or that I was travelling down a road that he had travelled a lot in his lifetime.  I recall screaming as our car slammed into one ahead of us and my head going through the windshield and dying on impact. scary part was as my head went through the windshield my scream continued and my face peeled from my head. How a scream continues as a person dies I don't know.  I then remember my spirit and my companions spirit getting out of the car. " I think we're dead" I told my friend, "No we're not." he replied, I leaned back and looked at the wreckage, which had been quite severe as many vehicles were involved in the wreckage, I again turned to him "Uh yes we're dead", "No we are not dead" he adamantly replied. I took two steps back towards the shoulder of the road and he did the same " Um, yep we are dead for sure" I responded and he looked at what I was looking at, " Yeah, we're dead" was his final reply. and this is where the dream ended was him resigning to the fact we were now in spirit form.