It has been confirmed that Dreams will run for the whole of the anniversary year for the very least - ie until April 2013. But, when you listen to Steve Davison, it seems that Dreams will be around a long time - he talks about changes to Dreams in the future and mentions 'seasonal' overlays can be used etc. Also, the infrastructure and technology invested for Dreams alone would make it financial suicide to pull it after one year.
However, how Dreams will continue after the 20th anniversary is yet to be decided. My bet, and it's *only my opinion* is that it will move to peak season showing only after the first year - ie summer/christmas. This is because to continue with Dreams all year round, the parks must be kept open very late in Spring etc as it must be dark for the effects. There is no way (again imo), that Disney will continue the extended hours every day - the cost in overheads must be enormous and I'm not sure financially it makes sense.
Also, I think the local residents would kick up a stink if they did. Am sure that's why the fireworks display is usually only Friday and Saturday nights.
As for hours in October - really not sure. I don't think anyone knows for sure. Again, it will need to be dark for Dreams to show so perhaps a little later than the usual 7 pm closing. It really is a guestimate right now!
Will keep my Disney planning fingers and toes crossed that they decide to open a little later than 7pm in October -- am only in Magic Kingdom for 1 day and Studios the next and have to leave Studios early to get the Eurostar so hoped to cram in as much as physically possible. I didn't know the parks don't open until 10am unless you have EMH which we dont
Doesn't help with your planning though does it!
Perhaps one day I'll learn not to be such a 'Monica' wanting to get it all planned so early