Hmm, just read this tread.
I can say that I've never ever felt pain in my dreams.
I dont know why... Hmm, even more strange - Nothing ever contacted my physical body in a dream, cause i dont have a physical body!
(only lately i started to experience bodily sensations)
I remember a bunch of dreams when i was faced against immensely
powerful foes, but I always either jump to other dream or escape or use
magic to make myself invincible or just desintegrate my foes with a
lighting bolt.... Easy life, huh? :)