There's an interesting article over in the newly-liberated NYT today, on the origins of the dragon myth (found via Jonah Goldberg and Andrew Sullivan), which seems to be an almost human universal.

Synopsis: we've always believed in dragons because of fears going back to the dawn of man, when we were still in the trees--they're an amalgam of the primary predators for tree-dwelling primates: snakes, raptors and cats. The myth was aided in its persistence by things like dinosaur fossils, which were mistaken by the ancients as dragon bones (even including mineral encrustations in the skulls taken as signs of jewelry in the head).

Interesting, but the article doesn't address in any way what's always been one of the most fascinating features of the dragon (other than to note it in the standard bill of dragon particulars in the opening grafs)--the fire breathing.

No snake, raptor or cat of which I'm aware belches flame, at least not on a regular basis, given a non-incendiary diet, and like the old Warner Brothers cartoon, if it did, it would likely be a trick that could only be performed once. So what's that all about? Is it just based on ancient memories of the extreme version of halitosis that a carnivore might display up close and personal?

And is it a universal dragon trait? I'm not a dracologist, and don't know all the ins and outs of dragons world wide, but perhaps my readership does. Do Chinese dragons breathe fire, or is it a habit only of the European variety?

The article also points out that the ancients never really doubted that dragons once existed--for them, the main question was, "why don't we see them any more, and what happened to them?" Given their state of knowledge, it was a perfectly reasonable question.

But here's a point on the improbability of dragons that pre-Darwinians wouldn't have been bothered by. Most, if not all dragons have four legs and a pair of wings. They're kind of like lizards with wings on their backs (and in fact, many dragon hoaxes were constructed in exactly that way). That is, they really had six limbs, since wings are considered limbs.

All flying vertebrates of which I'm aware (invertebrates are a different story, of course) only have four limbs. The wings have always evolved from the front legs. This is true for both avia (all birds) and mammals (both the conventional bats, which are rodents, and the flying foxes, which seem to be primates).

Evolution is capable of amazing feats, but it has its limits, and it has to work with the material available. There really is no plausible structure available from which to build large, articulatible wings, capable of lifting the body of such a creature, that come out of the shoulder, yet still leave separate, fully-functional forelimbs. In fact (ignoring the fire-breathing deal), this modern evolutionary observation is perhaps the strongest reason to believe that dragons truly are only mythical, and have never existed.

There's old Grand Master Clifford D. Simak's classic on this very subject, called "The Goblin Reservation" ( Amazon link above )
Simak, of course, explained the existence of ( spoiler: ) dragons very elegantly.
Here's a short review from Jandy's ( www.jandys.addr.com )

A few hundred years in the future humans have expanded out into the universe and rediscovered their own roots on Earth. Goblins, trolls, banshees, and the little people have once again been found and protected. Professor Peter Maxwell has studied them in his supernatural studies.

Maxwell was on his way to another planet where dragons have been reported. He never made it. Instead he was kidnapped by aliens on a crystal planet. He was offered the total knowledge of two universes for the right price. He now hurries back to her university to convince the head not to pass up this opportunity.

Back on Earth he discovers a duplicate of himself returned earlier and died in an accident. Now he has to convince the people and little people he knows he is alive and has important information. He meets a woman with a sabre tooth tiger, aliens on wheels, a Neandrathol man brought back in time, a ghost, and various other people. He has to find a way to get the knoweldge of the crystal planet.

What an imagination! Simak took ideas from both the fantasy and science fiction arenas and wound them together in a believable tale. In his future magic and science go together. When I was still trying to understand what different parts had to do with each other, he was skillfully weaving them together.

Regarding firebreathing, I think that was a convenient explaination for lightning.

Hmmm... how about wyverns? (Those would be dragons with two back legs but two wings in place of their forearms, a bit bat-like.)

Or Wyrms that had no legs, just a giant snake with wings.

Dragons not exist? Lies -- all lies!

At this very minute fire breathing Islamic Iraqi dragons are flying to the United States!

They will utterly destroy the infidels in the Satanic Bush administration! And infidels such as Rand Simberg, Glenn Reynolds and Madonna!

Tremble in your boots, infidel! Your end is near!

Hmm -- I guess I should have put a :-) at the end of the previous post for the humor impaired.

Six limbed dragons open up a whole 'nother can of worms.

Alien origin.

If dragons are, or were at one time, real, they are very unlikely to be of terrestrial origin.

I see fire breathing green dragons every night. The noxious smoke venting from the flagon like nostrils fills my mind with pixie dreams and unicorn screams.

Not being much of an expert in Dragons (if anyone can be), but having delved into myths and legends of all sorts here are my two cents.

Dragons do vary by culture, and their abilities/qualities vary just as widely.

Usually, the abilities vary by the color of the dragon, of which there are all manner of colors. Those abilities/colors also vary with geography.
Some examples, red dragons/fire, black dragons/lightning and or acid, green/steam.

Also as has been previously noted, there are other variations such as wyverns (2 legs, 2 wings), wyrms with no wings, reptilian cross breeds, etc etc etc...

IIRC are there not lizards who spit acidic venom from glands, akin to a viper?