At this point I tend to think that Dave was a creation of Hurley's subconscious as a result of his trying to deal with his food problem. Once they got to the island, though, Dave may have been manifested as reality the same way the polar bear and other out-of-place things have appeared. So one way of putting it would be to say that the island brings "dreams" to reality.

__________________
Things fall apart, the center cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned;

--Lines 2-6, "The Second Coming" by Wm. Butler Yeats