Xochiphilli has a point there, your friend can simply learn to ignore the bad imagry of the dreams through a sort of self imposed desensitization treatment. What therapists can do for example in the case of those with a fear of snakes is they can progressively introduce a snake into therapy sessions. So a client goes to therapy and usually talk with a councelor about things related to anxiety sense irrational fears like that are usually a transference of real life fears to fearing things like the dark or snakes and spiders. Thus they go to these sessions and over sometimes a long period of time (as in years, but it can be as short as a few sessions as well) a therapist slowly introduces the snake (or whatever fear) by saying things like well we have a snake in the next room, how does that make you feel? And the client proceeds to describe how knowing there is a snake in the other room makes them feel (generally tense, nervous, worried and so forth). But for the duration of the session they talk about real life fears and anxieties, each consecutive session induces the snake closer and closer to the individual until they are litterally conducting the session with the snake in the client's hand. Thus the client learns to differentiate fear and axiety about snakes and that of real life - which enables them to deal with those real world things in a good way.
Another more extreme route is to the snake and pretty much toss it on the person - intentionally traumatizing them and repeatedly doing so until their body simply becomes desensitized. However in my opinion that can have the potential to have serious draw backs if it fails.
With most phobias people just avoid the fear and then have a physical reaction if they are forced into such situation where they have to face it (EEK!!! ITS A MOUSE!!!). In the case of dreams a person who experiences fear reactions within them, is unintentional and unavoidable. Therefore a person who has specific phobias to elements within dreams is repeatedly traumatized by them. In the case of your friend it sounds like this has been going on for years. So its no wonder he's not open to seeing any doctors or trying anything he considers out there or unorthadox. At this point there may even be a measure of hopeless in that your friend simply believes there is no solution other than to go about business as usual and deal with it in the only way he knows how. Which touches on underlying factors in behaviors. We are conditioned according to the way we behave, its why people get addicted to gambling. Your friend has practiced these behaviors for a period of time and has gotten good at them so really there is no simple solution. If your friend refuses help, legitimate or alternative, its ultimately your friend's burden to bare. However in the case of all addictions (be they chemical or simply cognative/behavioral) no amount of advice or words of good hope will change a person until they are ready to change themselves.
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