Dear Crystal -- 
Related?  Can't say.  I can imagine both a yes and a no.  Some people might merit this "live in a fairy tale" description who don't have bipolar disorder, and I have to consider that you might be one of them, bipolar or not.  

But, as for the possibly-related-to-bipolar side, the behavior of "daydreaming" is pretty frequently described as part of people's experience in school, even when they don't recall other "ADHD" (attention-deficit hyperactivity disorder -- which very commonly travels with bipolar disorder and sometimes, but not often, requires treatment after the bipolar symptoms are fully controlled) symptoms from that time, such as fidgeting or blurting out comments and that kind of thing. 

You can see that "fairytale world" and "daydreaming" have some potential similarity.  But, more than that, I couldn't say.  The most important thing in any case is to make sure your bipolar symptoms are fully controlled.  If they're not yet, I'd hold out some hope that this fairy-tale story, if it was indeed related to bipolar disorder, might get "better" in the sense that your friends might say they'd noticed you seemed to be more present, or real, or grounded, or something like that.