I had a dream of fantastic palaces.
Does this mean that
1-my dream was ABOUT fantastic palaces
2-fantastic palaces played a prominant part in my dream; they were its setting...
This one's easier, Navi: if the narrative stops with the single-sentence context, the dream's topic was fantastic palaces (#1); if the context is larger-- dragons, princesses-- then the palaces could be just set pieces (#2).