How does the mind construct images in dreams? What do dream images look like? This is a much more complicated question than simply asking if someone dreams in color or black and white. The mind could reconstruct video - like if you watched a movie clip and then your mind replayed it in your dream. But how would your mind reconstruct the movie clip? It would surely alter it in a way similar to how dreams are different from ordinary experiences.
The above image represents what seems to me dream images are like. They are dulled down - since in dreams you are thinking less - but they are more emotionally potent. So the glowing colors make this image more emotional (similar to how gold is an emotional color), and they make it easy to see the image without thinking, as if seeing something glow in the dark.
My guess would be that when someone closes their eyes the patterns people can see on their eyelids (kind of like glowing outlines of abstract objects) help them to go to sleep because they are similar to dream images - it is dark because your eyes are closed and the faint lines or colors are very abstract so this low level of abstraction - similar to a dream - helps induce relaxation and sleep.
Dreaming and sleeping unlocks and uses the power of the unconscious mind. The unconscious is not as clear as things that are conscious, in order to think something and understand it it has to be clear, if it is more abstract or artistic the the thing could be described as being more unconscious.