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Away with the fairies 

The expression means to be in a daydream, to be in one's own world, sometimes to be deep in thought and having one's gaze unfocused while staring off at nothing in particular.
Alex was ignoring Fiona but she knew he was merely away with the fairies again.

off with the fairies. 

Used to describe people who are daydreaming, mentally unsound, not in touch with reality or incapacitated by alcohol or drugs.
Andy: "Aye look at Joe staring into space!"
Kris: "Yeah he's always off with the fairies."

dancin with sugarplumb fairies 

it basically means that you are under the influence of some substance.
Yo man, are you dancin with sugarplumb fairies?

Ya man i definitely am.

Away with the fairies 

giving off the sense of being preoccupied, dreaming, or delusional.
While explaining a complex math problem, Sarah noticed her classmate doodling on his notebook, muttering to himself. "Are you even listening?" she asked. "A bit," he mumbled back, clearly away with the fairies.

Ah sure he's away with the fairies.

away with the fairies Meaning: Used to describe someone who is behaving in a fanciful, distracted, or eccentric way; out of touch with reality or daydreaming.
Example: Ah sure he's away with the fairies.

Meaning Are you sure he’s paying attention? He’s completely away with the fairies.”

Tone/Connotation: Often lightly teasing, but can be mildly critical, implying impracticality, absent-mindedness, or whimsical foolishness.

chillin with the woodland fairies 

Yeeahh man, I was chillin with the woodland fairies..lol