The one that really stood out to me in my younger days was the Hammer House of Horror episode called Rude Awakening, with Denholm Elliot. In it, he's seemingly trapped in an endless dream, one in which he keeps waking up only to find he's still asleep...and wakes up again. This happens right up until the shock ending. As you can tell, that episode fairly stayed with me for a long time after viewing (well, I was young and impressionable at the time).
I'd also have to mention the dream sequences in the Corman/Price Poe movies. Always lovely and psychedelic (although they probably seemed horrible and nightmarish back in the day).
Talking of psychedelic, which we weren't really, it still amuses me that the Dr Who writers described the first transformation to be like a bad LSD trip. What were the Dr Who creators ingesting back then to even know what a bad LSD trip was like?
