But so much of what comes "from within" is simply the synthesis of what is taken in from previous external sources. I'm not sure creating things from whole cloth is entirely possible in this sense. You will always be influenced by what you have seen, read, and heard before.
Yes, I agree, which is how Coleridge differentiates "fancy" and true "imagination" (which he further differentiated into Primary and Secondary, but only Secondary really has relevance to this conversation, while Primary relates to what the Gnostics meant by "Logos"). Coleridge would hold that it
is (sort of!) possible to create things "from whole cloth," but that it is still more of a re-imagining, a
particular echo of the
universal archetype. In other words, it has relation and precedence in something archetypal and universal, but takes on a new form.
So I agree with your comment to Mustrum, which I think relates to the idea that creativity is not defined by novelty; when it is it can spin out into weirdness-for-the-sake-of-weirdness (which I find particularly irking) and tends to favor quantity to quality, superficial novelty to depth ala Andy Warhol. Rather, true creativity--and I would say imagination in the Coleridgian sense--must have some sense of archetypal, universal meaning and resonance (e.g. Campbell's Hero's Journey). This, of course, gets dangerously close to metaphysics (to say the least!) which I don't have a problem with, but some might.
This also might at least somewhat explain why D&D holds such lasting popularity (aside from the more obvious and mundane reasons such as market strangehold and name brand): It stays close to some core fantasy archetypes. Elves, Dwarves, and Dragons are lasting because they are mythic archetypes that have a kind of meaning that runs deep into our subconsciousness, into "mythic mind" so to speak.
So in a sense I am also talking about the difference between archetypes and stereotypes. This is not an easy topic, but I would say in short that the latter is a watered down and superficial version of the former, one that is lacking in a kind of creative juicyness that is hard to quantify, but relates to my usage of imagination. Imagination taps into archetypes, perhaps weaving them into a new pattern or even something never seen before, or even something that doesn't look all that different, but deeply captures something universal; fancy re-arranges stereotypes, going for quantity over quality.