What does the "dragon" mean?

I think the dragons are a metaphor for personal fears, that one must face up to to grow. The author is saying that once you face those fears they turn out not to be real dragons, but paper imitations.

Often the trepidation you feel prior to dealing with a difficult situation is much greater than the situation actually warrants. Every child fears doing things for the first time, but in retrospect the fear was unwarranted.

I agree.

dragon = your biggest fears.

facing them usually results in your realizing they are really little paper dragons.

That's what I think it's saying.

i also think at there "dragon" mean some setbacks, scary things, which can make people grow up quickly.
but in chinese culture, dragon often means good wishes adn things.

Instead of "dragon", I think that "demon" would be more approriate.

In Western culture dragons are fearsome mythical monsters that righteous warriors--knights errant--would fight in folkloric stories. They were formidable challenges. Metaphorically speaking, in life one's dragons are one's formidable challenges.

Many children have fears of monsters or dragons living in the closet. It makes them afraid of the dark or to be alone in their room at night. The dragon is a metaphor for fear, the unknown, large problems or things that scare us. Some children carry those "fears" into their adult lives.

This is telling the reader to "face" the dragon - see that it is just imaginary, not real, not that big or dangerous.

My horse has been trying to defeat her dragon for a few days. There's a swale in the field where water collects and runs off down the coulee. It's froze up now and pretty slick.

She wouldn't cross it even though the other horses did regularly, to come in for water. She would just look at it and walk back and forth along its length, hopin got find a spot where she could cross. I walked out with some carrots, fed her a couple and tried to get her to follow me across the "crick". No go!

Today, I put out a new bale which brought the other horses a runnin'. Dolly still wouldn't cross so I took out an armful of fresh hay, let her have a couple of chomps, then walked across the ice, dropping a bit as I went. With her dragon momentarily forgotten, she walked onto the ice, and even stopped to eat some of the hay that was on the ice.

She quickly discovered that it was only a paper dragon.

We can learn more about the Dragon at this interesting website:
The mysterious origin of the dragon
http://www.cor2000.com/0147258369/content/mysterious-origin-dragon/