A "dream book" placed under the pillow at bedtime prevents nightmares
Duane's hack reinforces my belief that a good book cures almost anything:
My four year-old tends to complain of bad dreams although she can never articulate what happens in them. This sometimes leads to her not wanting to go to bed. I informed her that if she sleeps with a book under her pillow, she'll dream about the book instead of having nightmares. Who knows whether it works or not, but it gets her mind off of nightmares just before bedtime which is probably the biggest cause of them in the first place.
(Typically it's a Cinderella or Care Bears book, but I swear, I once found King Lear under there. Yikes!)