It could be that your dream is perhaps a nudge. You mention that you perceived him to be more popular than you and so you were always worried of how that might affect the way he saw you or what you meant to him (to paraphrase). I don't know about closure in terms of that specific person; but what about the closure you can give yourself by moving forward and giving yourself whatever it is that you perceived to have missed out on back then? You say that there is a discrepancy in perception, as in the environment and scale don't fit, etc. You also mention hiding. And then this person from the past you feel you had an unresolved relationship with.

It could be that it is a treatise in how you see yourself and the impact it has on your life. You may not be able to gain closure from that particular person, but how can you move forward now and have more fulfilling experiences in the presence? How can you feel differently about yourself, and be able to value yourself in such a way that your perception of self has less of an invasive effect on your interactions with people? Could be the dream is trying to help you get to that place you are looking for: one of the ease of sexual frustration, a place of self-acceptance, and a realization that perhaps the reason the inner and outer environments of the dream don't measure up is because your inner and outer worlds in waking life don't balance.