ALLAH generates dreams and its HIS will if HE wants us to see someone in our dreams. ALLAH can show it for any purpose, sometimes to recite for that person’s spirit and sometimes to give us contentment that the deceased person’s spirit is happily among ALLAH’s blessed.
The dreams you mentioned means Excellent living in after life.
Green,white colours and smiling faces is an excellent sign.
Yes, In a way they do.
Like i said, sometimes the deceased is shown in a “bad” state and then we may need to recite for them.Its a way to tell us, that the spirit is not at peace and we as children should pray for them or do khatam-e-koran etc.
Yes, they can.
Yes, true.