Board Thread:Spoilers!/@comment-5491880-20160727022257/@comment-24674051-20160729171204

Actually, we don't know exactly when Mal conceived Lily. Nor do we know where the Dragon was prior to the DC (or even during the DC for that matter).

However, the impression that I have gotten of the the Dragon is that he is actually from the LWM, and is one of the few people there that is able to tap into the magic that does exist. And if that is the case, that precludes him from being involved with Mal in any way.