I have an idea here that we should put two guards outside the cave entrance to the "dragon cave" and also put a locked "door" into the gave. The story is that "the dragon was long ago released by one of the fallen angles to attack the city of Toldara but was cought in the cave". The guard should hinder anyone to enter the cave unless proper permission has been granted by some autority in TOldara (maybe the Mayor or some other important person that we can add).
This would explain the existance of a Dragon as well as make it fun to try to enter. Even at low level it would make sense to enter since there are baby dragons down below that drops fine items.