Based on what we read of course that was confusing and pure HUH?? but base on the dream I think it's sleep paralysis with somewhat like lucid because he knows he's in a dream but there is also someone trying to touch him which looks like the black silhouette which indicates the demon on our sleep paralysis, but we have another factor that the onther guy Seme use this to his advantage and touch Uke unbeknownst to him which might be a regular occurrence cause look at that panel where he finger him while he looks like his sleeping, so overall he is the demon in his dream but paralleld to his reality
Based on what we read of course that was confusing and pure HUH?? but base on the dream I think it's sleep paralysis with somewhat like lucid because he knows he's in a dream but there is also someone trying to touch him which looks like the black silhouette which indicates the demon on our sleep paralysis, but we have another factor that the onther guy Seme use this to his advantage and touch Uke unbeknownst to him which might be a regular occurrence cause look at that panel where he finger him while he looks like his sleeping, so overall he is the demon in his dream but paralleld to his reality