First I would like to commend you on your attempts to quite smoking. This is actually a very common complaint with those who use the nicotine patch. Although we can not say for sure why people have these vivid and sometimes terrifying dreams, we do have some good theories. Nicotine does have the effect of increasing our brain's memory storing ability. If you have nicotine in your system while you are sleeping, your may be able to remember events like dreams more readily. Thus, it may be that the nicotine patch is not creating strange dreams, but rather it is causing you to remember dreams that you would have had anyway but otherwise would have forgotten.
Before making any changes to your nicotine patch regimen, make sure to schedule an appointment with your primary care physician
(or whoever is prescribing the patch). Your doctor
will most likely give you the go-ahead to take the patch off before going to bed (if this is still what you want). If you do end up having unacceptable cravings in the morning, then I would say that it may be worth it to put up with the dreams in exchange for a better chance at success with quitting.