I picked 'something else'. I kind of like Dragons being de-coupled from a single environment- a Dragon nests where ever it damn well pleases.
Except for the White Dragon, which should remain a degenerate cold-weather inbred albino. Possibly White Dragons should gain a bonus to playing the banjo.
If Blue Dragons live on the beach, there should be a 1 in 3 chance that any dragon encountered is named Body, and when Bloodied the Dragon unleashes its breath weapon with a shattering cry of 'not cool, brah!'