Quote 1
"And dreams are the language of God. When he speaks our language, I can interpret what he has said. But if he speaks in the language of the soul, it is only you who can understand." (1.48)
According to the Gypsy woman, our dreams are a form of communication with the divine. She divides dreams into "our language" and "the language of the soul." It seems that everyone has their own individual language of the soul, which God uses to tell them a secret, but that it's also possible to dream in a collective language that others can understand. So … wonder what she'd make about our dream that all of our books suddenly developed thick pelts of fur?
Quote 2
"You came so that you could learn about your dreams," said the old woman. "And dreams are the language of God." (1.48)
The gypsy lady is getting pretty mystical here, but we think she's trying to tell Santiago that he should pay attention to his dreams because they are one of the ways that God or the universe communicate with us. (Remember that next time you dream that Ryan Gosling is making you breakfast.)
Quote 3
"It's a dream in the language of the world," she said. "I can interpret it, but the interpretation is very difficult." (1.61)
Uh-huh. Super difficult—except that "interpretation" of Santiago's dream is 100% literal. In the dream a kid tells him to find a hidden treasure at the pyramids, and her reading is that he will find a hidden treasure at the pyramids. Maybe he just needed someone else to confirm for him—or maybe she's a con artist.