A Dreamhosters.com is a FREE subdomain you can create to build your new/dev/test site on. If you do not have a domain, or want to a new site without taking your domain down, you can use a dreamhosters subdomain. You can also build a test/dev site off your current site if you want (if hosted here).
To see more info on WordPress and Dreamhosters:
If you want to create it on your current domain, check the following link to see difference between subdomain and subdirectory:
Start by going to your Manage Domains Page :
You will need to add the domain to your hosting.:
Pick a unique name, then add dreamhosters.com to it:
You can fully host the domain, I used a mirror to test a wordpress site.
Once you have set this up, the dns will still have to propagate.