Here is a clarification of what I meant by saying this being was physical:
He has a physical body, like ours and lives in our current physical reality, and not a being that resides solely in another dimension.
These were the impressions I was getting from him, since he was sending me a telepathic information.
Now, I don't know if he was there teleported with his physical body, or he was projecting a holographic image of himself remotely, or he was projecting his own energy body and somehow made it visible to my physical senses.
I know we use terms to describe things the best we can comprehend, but when I say "physical", I mean a life form that resides currently in our physical reality with a physical body. We can all travel with our "spirits" anywhere we want, including interaction with the physical world if we have learned how to.
A "non-physical" being I refer to entities who do not poses physical body, but may still interact with the physical world in ways.
After all we have to have terms to describe what we mean, but sometimes we interpret those terms in different ways.

Fascinating! From my own experience I would say the difficulty is just our perception. "They" don't necessarily look like anything we can describe so our physical intellect makes it 'fit' into something we can describe. That would explain why children tend to describe these beings in a rather childish way and adults get even weirder with their descriptions.
I resurrected this topic, because few days ago, I had a crazy OBE in which for the first time after all these years, my experience was related to this encounter. It started from a dream where I saw my sister at the age of 4 holding a small animal like creature sort of looking like a gremlin. I looked at the creature and when I say his eyes, this was the moment I realized I was dreaming. I took control and started asking my sister questions. I said where did you get this animal? She said, your friend the ET left their baby with us when he/she visited you, remember? I said , that's impossible, we do not have such entity in the physical world. She said, he is invisible. He was always living with us, but we could not see him. I looked at the thing closer and the little creature's eyes were exactly the same as the adult ET described in my first post. The baby had that orange hair on the top of his head as well. I said, OMG this is unbelievable, that's why sometimes in dreams I see these big round eyes like flickering visions. Then I snapped back. This is really exciting for me, because until now, I was never able to get further information about this visitor. Hopefully in the near future I will be able to find out more. I don't now if in this reality the ET actually left their baby with my family, but the first encounter occurred here.
Wow. Seems the more we learn the more baffled we become. I'd definitely want an update to this if there ever is one. Wish I had something brilliant to add.