but wouldn't kalstar (from ebberon) be
a) immune to it's nasty thing-a-ma-gigger,
b) by your reasoning, not be able to manfest/cast?
A) I don't know much about the Kalashtar, but if they even have to meditate, or some other substitute for sleep, they are affected, because any creature that has to have mental downtime is so that the brain can do its subconscious stuff. As this being messes with the connection between conscious and subconscious I'd think it might even affect kalashtar more.

B) If they play those listed below, nope, shouldn't be able to cast or manifest.

thing is, kalstar(excuse my spelling) don't dream, and why is dreaming related to casting anyways?
Psion/Psychic Warrior/Wilder
"He does not need to prepare them (in the way that some spellcasters prepare their spells), though he must get a good night’s sleep each day to regain all his spent power points."

"She must choose and prepare her spells ahead of time by getting a good night’s sleep"

Without being able to dream, the process that actually allows our brain to do its critical functions, do you really think they are getting a good night's sleep?

if you printed off all the monsters you have made, organized them by CR, then when your characters reapeadly beat your favorate,(of the aproprate level) then you just pull the next one off the correct stack and say "that storage for rent space was worth it!"