If you buy into Draconic boasts, then your best strategy is indeed to avoid all interactions with them. And if you were crushed by Dragons, then it's good for your ego to buy into Draconic boasts (Dragons are strong, wise, crafty, evil, etc).
Think of Shadowrun: isn't it a basic fact of the setting that you shouldn't make deals with Dragons? No matter how helpful you think they are, no matter how careful you think you are, and no matter how important you think the reason is, you'll always end up getting fucked over somehow so that the Dragon can get even more power. Well, either that or you get subsumed by the Dragon's sphere of influence and lose power and independence, and where will things go from there? Probably not well for you either!
So this made perfect sense, IMO. He treats Wyrms like Harry Dresden wants to treat powerful Fey: avoid all interacts, but be rude anyway because you're a low-Diplo idiot.