I interpret it differently (sort of), perhaps I believe that he's refering to the fact that there are some grim things inside us, or around us, that could very well kill, destroy, depress, disbalance us and we can't ignore them.
If you know there's something that's not working well, or not good for you, then you MUST adrees it. You gotta go face it, and defeat it, before it destroys you.
On the other hand I do believe there's something about facing the dragon that's interesting. I think that often times when you are facing difficult situations it seems like you are not good, or strong enough to bare it. But if you are brave enough to go face the dragon, and if you insist, and strive, then sometimes you are actually able to defeat it. (As if in the dragon's lair you found some mythical sword that helped you defeat it,)
And if I had to face a dragon, depending on its size, I would use bow and arrow, and try to pierce on of its eyes (and hopefully his brain ) with one of my arrows :)