The issue is that it IS wrong if you tell people that it was Lovecraft's idea, because Lovecraft never said such a thing. And it IS wrong when you pass around this dreaming idea as if it were an undeniable fact of the Mythos, which most people do.

I tell them "Show me the story/poem/letter in which Lovecraft said that" and they never turn up with anything. Heck, they never have evidence of other Mythos authors using the dreaming idea either.

Nor do they discuss personal reasons for why they think Azathoth is dreaming. It's not their own creative speculation; it's an idea that got spread to them from other people, and they took that idea as fact.