I think we become more or less conscious, however when awake our brain creates some kind of chemical or something that prevents hallucinations and we can only truly visualize very vaguely, but as we are dreaming it's like we woke up and are interacting in the dreams, in other words I don't know. I think the consciousness and subconsiousness, but the only thing that has changed is that now, since we are no longer "deluded" this interaction can now occur on our terms and not the subconsciousness terms, then again I don't think it had any inclination to control us to begin with per say, more a case of us being completely ignorant of what's going on around us. If children were taught to LD from birth this wouldn't be an issue as we'd always be lucid more or less.