I love many of the responses people have made so far.

Lucid dreaming can be used to face problems that you might not otherwise face in waking life. Say, for example, you've recently been through a divorce and are angry at your spouse. You can create scenarios involving you and your person of choice in lucid dreaming. Now, I'm not sure how effective it would be to your stress level to make mashed taters out of your ex in your dream, but it is possible to talk to that person in your dream. From there, any question you ask that person will be directly answered by the copy of that person your subconscious creates. Of course, it isn't the actual person, but it's how you and your mind perceive them to be. From there, you can begin to further understand your relationship with that person, perhaps understand why things didn't work. Though you won't be reconciling with the actual person, you will be reconciling with yourself.

But, if it's a monster or something you're terrified of, then you can mash it to bits.