all the monsters either directly came from Journey to the West, or are inspired by it. The lantern monsters exist in the original book although i dont remember how its appearance was described there.
You know you've made it when black brothers react to it with such a passion. To answer your question "what is the purpose?" All objects in Chinese mythology can gain the essence of life if they choose to train hard enough, and the final/perfect form is the human form, that's why you see bugs, rocks, animals and even lamp posts can start taking human form during their training. The evil ones will kill humans and other spiritual beings to get their life essence to accelerate their train to reach the ultimate god tier that everyone desires.