In Lego Batman 2 set in Lego Gotham City, the story revolves around Batman's efforts to keep the city safe. He teams up with Robin and other heroes. They have to deal with the likes of The Joker and his devious plans. There are also side stories involving the other characters in Gotham, and the whole thing is filled with the charm of Lego building and play. For example, there are parts where they have to use Lego gadgets to solve problems and progress through the story.
It can walk around in the Lego world. Just like how normal creatures move in our world, the Lego monster can use its Lego legs to stroll through the Lego streets or fields.
I'm not sure if it's an official new Lego set concept yet. However, given Lego's creativity and the vastness of the Star Wars universe, it's not out of the realm of possibility. It could start as a fan - created idea that Lego decides to pick up on. Or it could be part of a marketing campaign to test the waters for a new type of Star Wars Lego set that has a more humorous or unique angle, like the focus on a mustache.
The Lego setting makes their relationship more light - hearted in a way. The blocky, colorful world of Lego gives a different tone to their interactions. For example, the physical comedy that can come from their Lego forms adds a new layer. Batman's cape might get stuck on a Lego piece while chasing the Joker, which can create a humorous moment that changes the dynamic a bit.