The Queen Mab speech is one of the most famous in all of Shakespeare's literature. Remember that Shakespeare was a poet at heart and often inluded poetry in his plays in the form of speeches such as this. He loved to play with language, including metaphor, puns, rhythm, and rhyme, and that is what made him so popular with his contemporary audiences and makes his continue to be so beloved today.
For the Queen Mab speech in particular, we get a glimpse into the character of Mercutio like we do not see at any other time in the play. The guys are all headed to the Capulet party and are in a festive mood. Mercutio begins his speech in that same fun, frivilous mood, but it ends with much more bathos and melancholy. Some Shakesperean scholars believe the character of Mercutio to even have the characteristics of bipolar disease - his mood changes so abruptly from one of a light and fun air to one of much more pain. Others think Mercutio just had a flair for the dramatic and in speaking about the topic of Queen Mab stealing your dreams gets carried away. He has been portrayed both ways on the stage and in film.
Personally, I believe he just got carried away with the tale and meant no harm, but was just adding to the mood of the night. Also, I believe Shakespeare uses Mercutio as a sort of foreshadowing to show the upcoming instability of the moods of Romeo and Juliet when they meet which comes soon after this scene in the play.
Hope that helps!