Great clarifications Yeshe!
I forgot something which may or may not be important.
The term 'spirits' is also used sometimes in translating the categories of illness in Tibtean medicine. I can't remember exaclty, but I think there are 18 different 'spirits' types which represent the type of illness and determine how they are treated.
Therefore we may be told that we have a 'cannibal spirit' in our body and all it means is that we have a specific type of illness.
It's there we touch on the borders of casting out a bad spirit and it is so easy to mix up a reference to a simple medical condition, and its treatment, with the exorcism of a ghost being.
In all circumstances, if we hold a mind of Compassion towards the beings involved, there is no room for fear.
If you wake up and think you see ghosts, try to feel compassion for their situation. Peaceful sleep should then be possible.