As far as creatures other than humans being capable of dreaming,I absolutely believe this. Anyone who's ever had a dog has most likely noticed the twitching feet and short yelping sounds as they fall into a deep sleep.
When it comes to reptiles there doesn't seem to be much external evidence of this...pehaps an eeg would be able to detect heightened brain activity in certain levels of sleep.
However,I wouldn't necessarily link dreaming with any particular degree of intelligence. I think dreams are mostly an effect of emotion...which is quite plain to see in most any reptile.
Emotion without any associated action is useless though,so I would think there'd have to be some sort of translation between perception--emotion---response which I'd interpret as thought even if it is very basic and geared to the animal's short term well being as opposed to some future plan.
IMHO,it's more of a question of degrees rather than "yes or no".
German Tour Guide: You vill find more on Germany's contributions to ze arts in ze pamphlets ve have provided.
Brian Griffin: Yeah, about your pamphlet... uh, I'm not seeing anything about German history between 1939 and 1945. There's just a big gap.