The strongest creature at level 7.

Regarding the Arcat dragon, I don't remember seeing it in the original game; it seems like a unit from some mod.

I think they mean the Arcat dragons, which breathe liquid fire. But it seems like there are some mods involved, as Khottabych said, or else these dragons are just over-buffed.
In the original game, I always preferred the lava dragons, although I don't remember why anymore. Probably because liquid fire is tactically difficult to use; it often hinders your own units' movement.