So I guess, through normal procedure, if you take your dragon form while in combat (before taking out the gen) he will summon the demons anyway.
You need to take out the generator before being able to transform into a dragon (at least nearby). During the initial conversation he warns you that transforming is 'cheating', so summons the flying demons if you try to do so. Presumably taking out the generator during the fight is enough to trigger the summoning (and getting those cutscenes out of the expected order was what caused your dragon stone to remain disabled after the fight).
