I think children should have dreams which adults shouldn't crush- but I also think there is a big difference between a child's dream and unrealistic expectations/untruthful statements from a parent.
If I told my dd that "yes, you do have the right voice to go on the musical stage" that would be a lie and she would know it. If I said "anyone can aspire to the musical stage, it doesn't matter what voice you have" then that would equally be a lie and she would know it. And she would lose trust in me.
My policy has been never to tell my children deliberate untruths because I think it is very important that they should know that "my mum doesn't lie". I also think it is quite important that they should know I've got my head screwed on right and am not living in cloud cuckoo land.
But of course that doesn't mean I have to go out of my way to tell them unpleasant truths either.
There is a middle way between rubbing dcs' noses in their deficiences and actually lying to them; I am going to stick to that middle way.
So if ds tells me he is going to be a footballer, I don't say "no you can't", because that would be unkind. But I equally don't say "yes, of course you can" because that would be a lie and sooner or later he would find me out and lose trust in me. I say "yes, I can understand how you'd want that, it does sound great fun" and then lead the conversation on to his favourite teams. Job done.