(This is played as semi-serious comedy and is a good way to lighten PC's of extra equipment, normal and magic e.g. armour, swords, potions, etc)
The PC's hear rumours of a Dragon down the coast, not far (30 miles) from the village through which they are currently passing. The local council can't afford to pay anyone to get rid of it but it's been a pest to all the local fishermen for years. (It used to be worse but has been a bit quieter for the last 15 years). The PC's will be heros and a small reward may be found. The Dragon is actually Puff the Magic Dragon (from the song for anyone who knows it) and was drawn into this realm from the dimension of Dreams by a young boy's imagination (young Jacky Papers). They always used to play together terrorising pirate ships (fishing boats) etc until Jacky outgrew his boyhood "imaginary" friend. Puff has become broken hearted with the loss of Jacky and just mopes around all day in his cave (hidden in the mists of the coast). He is also a compulsive coward, and the only valuables he possesses are those things he and Jacky collected when Jacky was younger (balls of string, used pirate's flags, blocks of sealing wax etc). Puff is a green dragon (nonstandard) with a sonic breath weapon (his cry/wail) which shatters/disintegrates metal/crystal etc within 40'-70' (save applies) and does appropriate damage to people as suits the scenario. He can wail every 2nd round with NO limits and will usually do so (he really is depressed). (This makes it hard for fighters to do much to him unless they are lucky with their magical armour, magical swords etc).
At any time the PC's approach him he will be sobbing gently. He is a huge Ancient Dragon of green color (NOT a Monster Manual 1 Green dragon), hit only by magic weapons and the tears he is crying (every round) are actually large drops of acid (splash all within 20' for damage as appropriate). If they hurt him much at all, he will try to escape, still sobbing and wailing. Even when escaped, he will try to stay close to his cave (Jacky's toys are there) unless it is too dangerous. He will NEVER try to seriously hurt anyone! Any damage is incidental and caused by crying. If the PC's try to talk to him, he will check to see if Jacky is with them, then stop communicating, breaking into even more heart-rending sobs (tears in all directions - splashing out to 40' for 3 rounds).
The preferred solution to all this, if they bother to actually find out what's going on (the local sages/mages know and will explain for a fee), is to either send Puff back to the realm of dreams (extra adventure) or find Jacky Papers and reunite them (he is probably that madman wandering the kingdom having lost his memory with a great feeling of unease about dragons).