Over the next two years the SANDMAN title showed Gaiman stretching his creative muscles, as he varied between "short dreams" (essentially stand-alone stories, often featuring Morpheus of the Dreaming as the "host") and "long dreams" (longer, more involved story-arcs, some of which did not bear fruit until the end of the series). The first long arc, "The Doll's House," also invoked the image of dolls, but, like the famous Ibsen play, with a somewhat negative connotation, in which dolls were seen not as magical non-living presences-- as in the Brother Power story-- but as metaphors for being helplessly controlled by another's will.
As rendered by then-current Mike Dringenberg, the world of the Dreaming was taking on increasingly more complex, almost Jungian connotations, and this in part accounts for readers' enthusiastic reception of a world where dreams were real. "Doll's House" is perhaps not the best exemplar of this unique perspective. Though it's a long arc, parts of it are still more like short stories than anything, particularly "Men of Good Fortune," which has nothing to do with the plot of the arc, though it has a loose thematic relationship to the rest of the story.
At this point in the series Morpheus, having been released from magical captivity, is dealing with various problems in the dream-world he rules. Four entities, his "creations," have escaped the Dreaming, and there's an additional threat in the appearance of a "vortex," a rare phenomenon in which a mortal manifests the ability to wreak havoc on the dream-world. Morpheus must corral his errant creations and terminate the threat to his kingdom.
I said that Gaiman's conception was "almost" Jungian, because at this point Gaiman is still strongly oriented upon the Alan Moore model. In his early works for DC Comics, Moore helped pave the way for 'adult comic books" within the context of genre-productions, and one of his main strategies was to take an ironic or reductive view of key genre-fantasies. I won't attempt to recount the fine details of Gaiman's arc, particularly since they don't dovetail particularly well, but almost all of them relate to the ides of exposing some personal or cultural fantasy as deeply flawed or misunderstood. Taking them on an issue-by-issue basis:
#10-11 -- this issue introduces Rose Walker, the mortal vortex, who will in time learn that her everyday waking existence is actually a threat to the world of dreams.
#12-- Superhero Hector Hall, who took upon himself the identity of "the Sandman" within the pages of another DC comic, is exposed as nothing but a ghost with delusions of grandeur, manipulated by two of the nightmare-creations that escaped Morpheus' realm. The issue not only undermines the original Simon-Kirby conception of a "dreamworld superhero," from which Gaiman's Sandman was very loosely derived, it also features a few sequences in which a young boy experiences fanciful dreams evocative of Windsor McCay's "Little Nemo," but wakes up to ugly realities (a rat biting his face, for example),
#13-- the "Good Fortune" issue, in which Morpheus allows a mortal man to enjoy virtual immortality. During Morpheus' visit to Elizabethan England, it is revealed that a certain Bard owes his talent to having made a Faustian bargain with none other than the King of Dreams.
#14-- Morpheus tracks down one of his nightmare-creations, the Corinthian, to a very special convention, in which seasoned serial killers come together to discuss their avocation. In addition to destroying his creation, Morpheus forces all of the mortal killers to see themselves without the benefit of self-delusion. To some extent comic-book conventions and their attendees are the butt of the issue's satirical jokes, though it's reasonably clear that Gaiman isn't drawing a one-on-one comparison of comics-fans and serial killers.
#15-16-- Morpheus finds that the last of his errant creations, an entire dream-realm known as Fiddlers' Green, has taken mortal form and come into contact with Rose Walker. Though Morpheus' initial contact with Rose saves her from one of the serial killers, he then tells her-- within one of her dreams-- about her true nature, and that he must kill her to prevent her from destroying his world. He almost does so, but learns, through a very involved plot-line I won't recapitulate, that one of his supernatural siblings has been manipulating him to commit that transgression in order to destroy him Although Rose survives, she lives on with the feeling that all of humanity are merely "dolls" to greater, merciless forces, echoing Shakespeare's theme in KING LEAR: "As flies to wanton boys are we to the gods: they kill us for their sport,." However, in his confrontation with his plotting sibling, Morpheus reveals a new wrinkle: that he and all of his metaphysical kindred are also merely "dolls," for they are brought into being by the passions and aspirations of mortal beings. At the end the sibling in question refuses to acknowledge the truth revealed by Morpheus, and the story ends with her thinking that she's "nothing like a doll at all."
It's a promising theme, that of the interdependence of mortals and their archetypal creations, but "Doll's House" doesn't live up to its potential. It's obviously an amalgam of separate story-ideas that Gaiman sought, only with partial success, to meld into a unified structure. Nevertheless, even if this early Gaiman work goes a little overboard with all of the "beautiful dreams hide nasty realities" schtick, there's still enough attention to the symbolic resonance of the dream-world that it isn't totally reductive in nature. One example is "Fiddler's Green," who is apparently the incarnation of an Earthly Paradise, without any attempt to reduce him to something else. Rose Walker is a little on the dull side, as if Gaiman wanted to make her as simple as possible for contrast's sake, but I found this simply made it harder to invest much conviction in her character.
It's a flawed story, but not so over-intellectualized as to fall into the category of the "null-myth," and it does prove to be of major importance in elucidating Gaiman's not-quite-Jungian concept of a universe of dreams.