I think i actually encountered something similar to the slug you describe!
In my case, i was having a nightmare, it was a new one, tailored to myself at the time (utilizing characters i’ve only known a few days). I knew it was a nightmare, but i lacked the strength to break it. Finally, as it went on longer than most and more horrific, i’ve had enough and removed myself from it.
Immediately i found myself in a black plane, perhaps outer space (absence of stars or other corporeal objects) with a behemothian monster, only a part of it visible, in front of me. A great eye staring at me, yet without thoughts or sentience. I queried it several times, no response, other than to continue stretch it’s tendrils of nightmare toward me. Before i distanced myself from the nightmare, i think i must’ve been covered head to toe in the black plane in them. After a while when i realized i can’t accomplish anything, i exited that plane as well and woke up.
It’d use any environment, any platform you know, perverting and twisting it until it’s a horrendous parody of what you normally think of it. I still think of it in third person. I realize it’s somewhat unbelievable that it’s really a foreign entity and not in my head, but what the hell. It is so other to myself that i prefer to think of it that way.
What i think is important is to realize that you can beat it’s nightmares. No matter how it corrupts your dreams, eventually you will have the power to exit the nightmare. To refuse to participate in it’s twisted weaving. Knowing that, believing that, it deals with it. I haven’t seen its nightmare in years, despite seldom still meeting the creature.
Funnily enough, i did no “negotiations” or talks getting to know it and all that colorful ribbon wrapped deals to resolve the issue. I somehow think it wouldn’t have worked, it didn’t seem capable of anything but singleminded determined crawl of nightmares.
The advice above probably didn’t help much, you can’t just apply it to yourself and deal with your slug the next night. But i think it should be a comfort that eventually, you’ll be pushed far enough and you’ll refuse to yield any more ground. And that’s when you “win”. It’s inevitable, somenight it’ll happen.
The next time you have a slug nightmare, try to remember that the worse it is, the closer you are to beating it