This is a question that invites us to reflect upon our respective belief systems. Some people devoutly reject the notion of reincarnation, others accept it as an absolute fact, and a given number fall into the "undecided" camp. If anything should be obvious, it is that no one is likely to alter his/her beliefs on the basis of the two paragraphs that follow, below.
I find it easier by far to suggest that when people experience a past incarnation (most often through hypnosis, although there are other, more esoteric techniques), they encounter what is either a very real and literal past-life or something that may instead suggest a metaphorical representation of where they stand at present. Obviously, unless I can see compelling evidence of an actual past-life, I shall find it infinitely more palatable to translate the metaphor.
Dreams have been used in therapy for many years, and clearly they may be of profound significance. So, too, hypnotically-guided experiences of this sort may prove therapeutic. That said, however, I believe "alternate universes" -- accessed through techniques developed by my colleague, Dr. Don Gibbons, a clinical psychologist in New Jersey -- offer therapists something of even greater value. More on that topic in near future!