He remedied his issue with his perception of the moral from Dragon Quest being "You have to change your race to be decent" by...having a bunch of dragons live in a pony city, adopt pony culture, and (apparently) even adopt disdain for non-"enlightened" dragons. (Whitley said that they went to Dragontown because they wanted to live a decent life, ie not living like a dragon, but like a pony)
People make fun of this story for a reason. Instead of correcting the issue he saw, what he actually did was create a bunch of dragons who not only gave up their culture, traditions and lifestyle but added some bizarre victim complex thing that makes you wonder why the dragons want to live around there to begin with.