Dragon genealogy and the "Leaky Bucket"

The Core Race Breeding Limitation is more of a Guideline than a Rule with dragons

Dragons are one of the Core Races and the core races normally produce sterile hybrids when they reproduce with someone outside of the core races.
But dragons tend to break a lot of rules by their very existence.
There has never been a recorded instance of an elf-gnome hybrid or Gnome-human hybrid woman every becoming pregnant and there is no recorded instance of a man of this mixed parentage impregnating someone else.
Jelsa, Granddaughter of Pogerth is living proof that half dragon/half gnomes are not always sterile. They just are usually infertile.
Pogerth was male dragon who had a tryst with a gnome and created a half-dragon/half gnome son, named Tolryt who went on to have two children with two different gnome women.
Tolyrt was a notorious womanizer who was with many gnome women over multiple decades, Tolyrt only had two children and two miscarriages in all that time.
Jelsa is a public figure so her case is well known, but her case is not unique. Jelsa is for lack of a better term, a "typical" case for draconic legacies of non-Core races.
Jelsa looks like an ordinary gnome in most respects. She has a somewhat scaly looking birthmark on her back that is normally concealed with her clothing and she has her grandfather's eyes. Jelsa is also about a head taller than the average gnome woman. The end result would be similar for a goblin, orc, dwarf, archapliza, or most other mortals capable of mating with a shapeshifted dragon. The half-dragon would not be barren or sterile, but would have fairly low fertility, and said half-dragon's hypothetical offspring would have pretty subtle draconic traits. The eyes are usually but not always the last draconic feature to disappear, not counting a latent potential for sorcery which seems to linger longest.
A human or elf with one dragon grand parent would have more overt draconic traits than draconic legacies like Jelsa, but they would still resemble a mostly resemble a normal human or elf in most respects. Again, draconic eyes linger the longest.
What about kobolds?
It is worth noting that half-dragon/half kobolds tend to create stickier draconic lineage than most other half-dragons. This supports the notion that kobolds like to claim direct descent from dragons. Two factors prevent half-dragon/half kobolds from taking over Scarterra. First, dragons don't mate with kobolds very often. Second, half dragon/half kobolds seem to have relatively low fertility.
A female half-dragon kobold will find about three quarters of her fertilized eggs miscarry (whereas only about one-in-four eggs of a normal kobold female miscarry) though they can mitigate this somewhat because they have longer life spans and a longer fertilily window than most normal female kobolds. If a male kobold fertilizing an egg of a normal kobold female, the egg still has a three quarter failure rate. That failure rate is before their birthing trek. Half-dragon kobolds grow up strong but they are just as weak and vulnerable upon birth as a normal kobold hatchling.
Most kobold clans that had the bright idea of letting their male half-dragon leader keep a harem of females with the goal of creating a generation of mighty draconic legacies tend to go extinct because so few of the eggs are viable.

When half-dragons have children with half-dragons

This scenario was rare until the founding of the Kingdom of Swynfaredia when four dragons collectively had about 40 half dragon/half human children and then arranged marriages between their half-dragon children and then continuously forward, avoiding incestuous ties the best they could.
Some of these half-dragons had affairs with normal humans diluting the bloodline with legitimized bastards but not many. Even without cuckold babies sneaking in, each successive generation was just a little bit more human looking than the previous one. Even with the Swynfaredian dragon bloods bringing in new half-dragons into the gene pool, most dragon bloods today look more or less like ordinary humans with less than ten percent manifesting even minor draconic cosmetic features though many use cosmetics or illusion magic to mimic draconic traits.
Swynfaredian genealogists have nicknamed this phenomenon the "Leaky Bucket". The idea is that the essence of a dragon is too powerful to be easily contained in a human bloodline, thus even with carefully controlled arranged marriages, draconic heritage tends to gradually fade away as each time the contents of one bucket are moved to another, a little bit is lost.

by Eron12 with Hero Forge

by Eron12 with Hero Forge

This is phenomenon not limited to Swynfaredia, it is just comparatively rare for draconic legacies to mate with draconic legacies outside of Swynfaredia. Such events occurred fairly often during the Red Era when a lot of dragons tried to use half-dragon offspring to control the emerging human tribes, but it was not common practice to keep detailed genealogical records back then so the observance of this metaphysical law were lost only to be rediscovered by the early Swynfaredians much later.

Type

Metaphysical, Supernatural