Generally dreams are simply the continuing resolution of externalities against your brain's internal world model. When dreaming they become unhinged from realit

Generally dreams are simply the continuing resolution of externalities against your brain's internal world model. When dreaming they become unhinged from reality because there is no actual sensory checks to keep them grounded. A simple one to understand is the Tetris Effect where you brain continues resolving potential patterns of blocks falling. That this nightmare has never been fully resolved could be why it reoccurs. I would guess when you see the monster it will stop, but depends what the monster is potentially standing in for. What you could consider is what triggers it - is there something during the preceding waking hours that causes you to revisit that dream?