It belongs to the genre 'Fantasy' Not 'Sci-Fi'
It is just fantasy and that too not a very good one and low production budget makes it even cheesier.
I don't see any science in it! It never even tries to stick to the basic premise which is - "Main lead can do effective dreaming. Every one except the dreamer(main lead) forgets about the world before the dream"!
To me:
Sci-Fi == There is a basic premise, premise can be any assumption whether possible or not in our physical world and then the writer, directer, etc can expand upon that basic premise scientifically and logically but taking great care not to harm or alter the original premise. That is the reason people try to find plot holes in Matrix because it is a logical extension of a basic premise!!
Fantasy = anything goes! Hence, you can (or should!) not find plot holes in a fantasy....well, hello it is fantasy!!! If you dont agree try finding plot holes on Snow White or Smurfs.
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