I'm fairly sure if you think about this too hard you end up in a spiral staircase of logic.
At first I thought "You could see it that way - the exaggerated version of Bilbo in the films might dream up the events of the films."
But then... film Bilbo is a character in film Bilbo's narrative (which he apparently dreamed up).
Therefore the exaggerated Bilbo of the film's narrative dreams up the film's exaggerated narrative, because he is the exaggerated character of an exaggerated narrative.