Thats a good question Howetzer. I think that it's a combination of both. I think those individuals that we know in the waking world that appear in our dreams are from our memory. Those dream characters we never seen before I think are mixed combinations of the thousands and thousands of individuals that we have seen throughout life. I think the subconscious stores information of people that we just glanced at from years ago. And only in our dreams that this information is made available to us once again. I think sometimes it is fully those people and then sometimes the mind kinda jumbles it up to create an entirely new person based off of two or more individuals.