As someone else pointed out -- I *wasn't* already a dragon. In fact, what powers did I supposedly have that would be a threat, at all, at that point? I *WASN'T* a dragon -- I'd been, perhaps, 'tainted', but there was nothing about me that was different from before -- I hadn't killed anyone, I had no special powers (other than those gotten via being a dragon slayer).
No power, but a potential: the potential of being a dragon. If Talana's legacy died with her, there would (normally) be no more Dragon Knight ever. However, she gave a slayer the dream, so the potential of a DK, and that's already too much for the slayers. As long as he is alive, he has the possibility to become a complete Dragon Knight, or maybe even 'contaminate' another slayer. As fanatics, they couldn't accept the risk... so didn't the Sint Inquisition about Cathar Perfecti during Albigensian Crusade, because it meant they could create other Believers and Perfecti.