Dreams like the one you described can often reflect your subconscious thoughts, feelings, or experiences. Here are some possible interpretations:

1. Symbol of Confidence: The large size of your genitalia in the dream might symbolize feelings of confidence, power, or masculinity. It could indicate a desire to assert yourself in certain areas of your life or to feel more in control.
2. Desire and Rejection: The interaction with the woman and your decision to decline might suggest a conflict between desire and your personal boundaries. It could reflect feelings about intimacy, commitment, or the dynamics of relationships in your waking life.
3. Observation and Power Dynamics: Standing and observing the other couple could signify feelings of detachment or being an outsider in social situations. It might also represent how you perceive relationships or sexual dynamics around you.
4. Exploration of Identity: Such dreams can also signify a deeper exploration of your identity or sexual orientation. They may indicate a need to understand your own desires and boundaries better.

Reflecting on your feelings and experiences around the time of the dream could provide further insights. Consider whether there were any significant events or changes in your life that might relate to these themes.