ANSWER – You will be delighted to know that I am not qualified to comment on whether or not you are crazy so we’ll move forward with the presumption that you are not crazy and the understanding that if you want that confirming you see a qualified psychologist rather than a witch.
The nature of dreams is a tricky subject indeed. The “weird stuff” you refer to is not at all uncommon. In fact the only time I’d ever be surprised about the nature of another person’s reams is if they told me they didn’t dream weird stuff. Dreams are essentially fragmented pieces of our sub conscious which come together, often in very strange ways. If you analyse a dream you can usually work out why certain elements have appeared. It might be a book you are reading perhaps, a song you heard on the radio, a phrase you heard that day on the TV, a chat at work. Your subconscious stores things you may not have noticed on a conscious level and then these ideas, images and concepts come out to play when you go to sleep.
That said I would be loathe to deny that dreams can have an element of clairvoyance. It isn’t very common but there is enough evidence of precognition facilitated through the dream world for me to believe there is some amount of truth to it. My own theory would be that it isn’t the dream itself that is foretelling the future, it is your own intuition but your conscious mind isn’t rested enough to hear the intuition so the suppressed knowledge comes out in the form of a dream instead. I think you would find if you meditated regularly and learned to distance yourself from the noise and detail of the mundane world you would actually be able to grasp that foreknowledge on a conscious level.
The situation where you discuss the demon is interesting and I noted you come from a very Catholic country where demonic possession is perhaps taken more seriously than it is in some other parts of the world. I’m sceptical (depending on your age) whether it was appropriate for you to be at the exorcism of your mother and I wonder if the trauma has had some impact on the nature of the dreams you are experiencing. In terms of the demon itself, expressing an intent to kill is not indicative of its actual abilities. Many demons are not actually all that powerful. However the fear associated with any demonic interaction can be potent and I am not surprised the memory has stayed with you.
You seem to see the demon incident as being a catalyst for your life taking a downward turn but I actually doubt this is the case. A person either is or isn’t possessed. It doesn’t come in degrees. If the exorcism was successful, the demon was banished and it would therefore have no further impact on your life. What I suspect is more likely is you need some help putting the whole experience to bed and moving on. I think it’s your own mind and not the demon that is causing you problems. Chatting things through with a therapist who has a good understanding and more important an open mind to the occult may help a good deal. The fact that you are also filling your mind with books of witchcraft and mythology may also be exacerbating the problem. As with dreams, what we put into our minds is often what comes out. Try to steer away from the metaphysical for a while, give your mind a rest.
You seem very conflicted on your views of religion. You use terminology that seems very Christian but then conclude that religious people have no meaning for you. I wonder if some of this internal conflict is contributing to the problems you explain in your question. I would have a good think about how you can find a harmony between your experiences and your religious beliefs and try and find a way to forge a unity between them. Nothing is likely to upset the balance of your mind more than an internal struggle with your own belief system. Be honest with yourself and I think that will take some off the pressure off your shoulders.