Did they think they'd found remains of dragons, or some such?

Thing is, the "fossils inspired dragons/other mythical creatures" line is a piece of modern folklore, and is in itself Not Quite How Folklore Works. If anyone else would like to contribute on this subject, please don't let this post stop you! More posts are always welcome, and the sub firmly believes there's no 'final' answer on any subject. For the meantime, OP, whilst this is popular belief, there's some significant problems with it, explored by these previous posts:

• u/itsallfolklore explores the folkloric side of "dragons from dinosaur fossils";
• u/MrPaleontologist explains the paleontology side and some practical difficulties relating thereto;
• and u/svatycyrilcesky further expounds on the paleontology side and more practical difficulties.