"A dwarf? No, I've never seen a dwarf. Nobody around here has. They stay up there, in the hills, waiting for those foolish enough to seek them out. The locals aren't that stupid. Only folks like you are that 'heroic'.
Look like? Boy, I told you, I've never seen one. Nobody has. All I know is what I've heard in the legends: Half the size of a man, but with fingers twice as long. Old as the hills. Wirey, gray men with wirey gray beards, and not a strand of hair upon their heads.
You need a weapon that will peirce dragonhide? Aye, I suppose they'll be able to help you with that. They've built a ladder that reaches the stars, and a castle that can fold up in the palm of your hand. They'll have little trouble with a sturdy Axe.
But they'll charge a high price, not gold or jewels, but something even more precious. and you best be paying it too. If they built a thing, they can lay a curse upon it, and everything that's ever seen it. Their curses have destroyed dynasties, and brought down kingdoms.
Thats why nobody sees a dwarf. They demand fair dealin' and they demand respect. Your lot's short on both. So go ahead and seek them out. Ignore my warning. But if you do find the dwarves and their misfortune, don't be coming back here."