There's a sort of puzzle element to these action sequences, according to the new article: the "stairway" is made of blocks that Vincent has to shift around to make a path. That path has to be made quickly and efficiently, because there's a time limit. Some of the blocks have spike or bomb traps, which Famitsu suggests can be used as items.
As for those sheep-men that inhabit the dream? They aren't enemies: instead, Vincent can get clues about the mysteries in his waking life by talking to them. "I heard that girl Catherine is BAAAAAd news." Ewe'd do wool to listen to them.