As long as your son is very clear what is imagined, and what is real, I would file these episodes under creativity. I'm a professional writer of fiction and nonfiction and can confirm that I also do this, just on a smaller scale. I've done it my whole life and never gave it a second thought until I read your post. I can feel the energy of the story that I'm imagining enough to have to get up and walk around. I don't have the conversations out loud, but I do sometimes have the facial expressions and gestures that go with the dialogue. I don't do it in public, but every now and then, my husband catches me and says, "Everything ok?" LOL. I honestly thought everyone did this in some form. But now that you mention it as a "writer thing," that makes sense. To be effective, writers have to imagine a scene so completely that they can transport readers there. This is just one path to doing that.
Seems like what is really important is your son being able to turn it on and off as he desires, which would relate to impulse control and executive functioning. I hope he can keep it in some form as he matures. It is a powerful tool that can be applied not just to storytelling, but to other careers as well.
