What.
You may not have ever seen EXACTLY what you have in dreams, but you've seen people before, you've seen facial features, you've seen signs, you've seen letters, you've seen pictures, etc. Your mind has pieces from thousands of different sights and memories to go by; It rearranges them into different images and projects them in dreams.
It's why you can't dream (Most likely) about a precise medical operation. You've never seen one done from start to finish in great detail, so even though you may be in the ER holding a scalpel while inside of a dream, you won't be able to recount and perform the procedure when you wake.
Then again, I could be wrong. I'm not expert on this, but it seems to be logical enough: You can only see what you know and associate images therefrom.