Hi,
I am REALLY interested in having lucid dreams. However, I heard about the “old hag” and other hallucinations. I was curious on how rare that is, and how to deal with it.
Thanks!
Hello Draconium, 
The problem is that it’s a bit unclear if “old hag” involves any kind of sleep paralysis (SP) or just the terrible one.
I am sure that the “old hag” event as the feeling described as some aggressive person over you is really really rare. I never had it myself.
Breaking sleep paralysis (SP) is easy if you stay calm,I have written several hints about it.
Here is an article about breaking sleep paralysis.
Hallucinations vary a lot depending on each person. Most people I know rarely hallucinate.
SPOILER - Click to view
I have a feeling that in LD4all, people who rarely hallucinate might even envy people who do, because it is harder to use some incubation techniques without hallucinating (example: techniques that involve HI).
Same here! 
I have had hallucinations a few times and they have always been harmless (short dreams about repetitive things I did in the day, friendly beings who came to greet me, visions of my astral body and even my dog talking to me, ha ha 
)
[color=blue]This is what usually happens to me when I enter sleep paralysis:
First: the loss of sensation in the extremities.
Second: seeing flashes of light beyond my closed eyelids.
Third: A nice tingling sensation that feels like a soft blanket around my body.
And last: (if I didn’t fall asleep after the tingling sensation) I finally start to see my room with my eyes closed.[/color]
I believe that a thing that had helped me through the years is to not be afraid of whatever that appears, dreams are heavily influenced by expectation and if you are afraid to see certain things… They usually appear. You can’t help but fear, but you can work on how to face those fears when they present to you.
Years ago (in a LD) I was pursued by a demonic looking girl with a blade! After stopping to ask her how I could be able to help her, the child told me that she was trying to protect me from someone & she did it when he came!
It’s important to remember that appearances always deceive us: what seems dark & scary at first may be the purest & friendly thing you will ever see. 
Its allways the same: you just have to ask the creepy people in your dream what they want from you. In most cases they will show you how friendly they are. 