The opposition of fantasy and reality is equivalent to the opposition of truth and lie.
There is constant conflict between these two: What is and What ought to be/what is desired. But there need not be any opposition if the fantasy, what ought, is acted out in reality thus converted into what is, reality.
In this creative act the human makes him/her self. This requires a lot of courage because the other fantasies of other dominant humans impose them selves as realities, as general rules of conduct, i.e. conventions. Most people take the route of pleasing the majority by following these conventions and forget that they have to please themselves. Following is not creative and so these people do not make themselves, they allow themselves to be made. Made in the shape of someone elses fantasy.
This imposed fantasy is not a lie because it is imposed, and so made real, by someone following it. It becomes a lie only as soon as it is rejected.
But the conflicts arise because in following someone elses fantasy you reject your own. Your fantasies are repressed and the more they are repressed the more they grow into unreal monsters, untameable and wickedly deceptive. The more they are restrained the more vicious they become.
But as soon as they are vented/acted out/released, they dissolve into the elements of reality giving the world back it's poignance and it's contradictions.
The moral of this story is: Monsters are only there if you don't look at them.