Dragons fear humans. In this setting, it's not in the same way that a human fears a vermin infestation; humans are fecund, for certain, but dragons have much more to fear from what humans are capable of rather than just their sheer numbers. They would never admit it, of course, except in the most trusted of company.
As previously mentioned, the Council of Wyrms was ultimately spurred to creation by the danger posed to dragonkind by human dragon slayers -- champions originally inspired by Great Io to sail across the sea and give the dragons a true threat that they must unify against. Now, there's a lot about this old legend that causes one to scratch their head, first and foremost why creatures and proud and stubborn as dragons would give homage to a deity that repeatedly engineered their destruction until they were brought to heel. I may delve into that conundrum at a later date.
The dragon slayers came from a nameless, obscure land across the eastern sea, one the dragons either ignored or did not deign to learn about during the war. All that is known (though perhaps, only by the most cloistered acolytes of Great Io) is that the humans were visited by the Ninefold Dragon and told of the wicked monsters that lived across the seas. Great Io taught the humans magic, metallurgy, and the means to make war on such titanic creatures.
For what reason did the humans follow his wishes? Well, at the time of the visitation, the humans were naught but scattered tribes, and the appearance of such magnificent divinity in their midst assuredly inspired a culture that both worshiped and feared dragons. Perhaps Great Io told them that one day his wayward children would visit calamity upon the humans unless culled or vanquished first. Fantasy religions have been founded upon stranger things.
What we don't know is what the culture of the humans of this setting is like except for the broadest strokes, or why every once in a great while (we're talking on the scale of centuries or more) one or more dragon slayers return to the Io's Blood Isles. Now, the reason this isn't covered in the boxed set is pretty obvious; this is a game about dragons as player characters, centered around the Io's Blood Isles, not humanity and its cultural dichotomy of both hating dragons while worshiping their chief god (or at least, such seems to be implied).
The Council of Wyrms books talk about the dragon slayers once visiting the Isles with flashing steel and terrible magic that rivaled that of the dragons themselves. Some interminable number of human lifetimes later, at least a couple return to play a part in one of the boxed set example adventures (it's been 22 years, statute of limitations is up on spoilers there, I think).
We can assume that this society of humans has mastered high magic, shipbuilding, and the forging of tough steel armor and large weapons capable of penetrating dragon scale. There is even a precious single image in the book as to what one might look like -- a woman with fabulously 80s hair clad in full body armor, mercifully (and possibly unique in this era) free of boob-plate, with a helmet shaped like a dragon skull and a sword on her back that is absolutely styled after a historical zweihander.
The adventure also tells us, in a couple paragraphs, that the dragon slayers were scattered after their defeat at the hands of the united dragon clans. Some of the human tribes remained behind on the Io's Blood Isles, living in hiding or at the mercy of benevolent clans (but never as part of their society). Some returned home, scorned by their own people for such a disastrous conflict -- and as the centuries passed, they lost much of the knowledge gifted to them by Great Io, particularly how to build their mighty ships to cross the seas.
Many fantasy roleplaying game cultures adopt the idea of eternal medieval stasis in order to maintain the status quo and retain mass market appeal; that is, technology rarely evolves beyond Gothic architecture, sturdy full plate armor, steel weapon construction, and Renaissance-era medicinal and artistic advancement. The vassal races and humans of the Council of Wyrms setting are no different. There are, of course, notable exceptions whose unique flavor sets them apart. A culture that fully integrates magic into its academic and technological achievements nets you Eberron, for example (which I adore, but that threatens a huge digression).
The dragon slayers that remain are outcasts, and we know very little about what else exists over there. Dragon slayer cabals continue to exist and train future generations, but if they enjoy a status little better than unwelcome neighbors in human societies, then they surely lack the numbers and support to mount further invasions. Their culture and advancement seem stuck in the same state they were at the time of the last war -- it's easy to imagine the tribes, so quickly uplifted by divine intervention, that they settled into perpetual and unending conflict in the generations that followed.
While we don't know what these lands are like now, I prefer to imagine them as crumbling kingdoms ruled by impotent dynasties, feuding over precious resources and the loyalty of a populace that never quite recovered. Warlords and monsters sweep in with generational frequency, visiting calamity upon the humans. Perhaps the dragon slayers -- conquerors of titanic beasts they are -- gain periodic influence by restoring order and vanquishing mighty terrors, only to be driven back into their crumbling citadels after the threat passes.
And when they discover a way back to the shores of the Isles? The dragon slayers would likely jump at the chance to finally complete their mission, thousands of years after they failed.
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