So I translated some more, and found additional tidbits:
The dragon gains more experience if its level is lower than the hero's.
It DOES gain experience based on the damage it deals... but only if the damage happens DURING THE CASTING OF THE ABILITY. That means ball lightning's surprisingly high base damage is actually compensating for you not getting any credit for the damage. You gain a bonus to experience (this is simply added to all else) = 1.7% of the total leadership of units killed. This value is bounded by an odd equation:
LevelDiffExp / (Petlevel/5 +2)
Where LevelDiffExp is the amount of experience it takes to get from the current dragon level to the next (independent of your current actual experience).
This means that killing things somewhat above your level is good, but it maxes out.
Furthermore: The scalar for dragon xp (K) which is determined by your leadership / enemy leadership maxes out at 1. That is, having far less leadership will only ensure that the value remains at 1, it will not increases it past one. In addition, the first ability you use every battle will always have a K of 1, independant of the size of the opposing force.
This is why you can get actual dragon experience from the 10 devilfish you kill on debir, even though they are a vanishingly small percentage of your own leadership.
Let me try to sum this all up into a few key words:
- You always get full experience on your first dragon ability
- You get less experience after the first, if you have more leadership than the opponent in play
- You get full experience so long as your leadership at casting time remains equal to or less than theirs
- You get 1.7% of the direct damage you deal as bonus dragon experience
- You get more experience if you are higher level than your dragon
- That means increasing your own experience also increase your dragon's experience!
- It also means it becomes hard to level your dragon up if it is higher level than you.