Just to give some context on why dragons may not do this (at least according to the Monster Manual):
The dragon may not want to spend a round or two grappling after using the Snatch feat, just by preference.
Agreed, but it is feasible option nevertheless, because it takes out most foes (maybe except the monk), stopping them causing more trouble. Snatch is a standard dragon feat, and it makes the dragon an even more dangerous foe, especially if the party has little time to prepare for combat. What first: Resist Energy? Freedom of Movement? Dimension Door? Fly? Resilient Sphere? Wall of Force? Forcecage?
So, we know that dragons want things, especially coins and magic items, and this goes double for red dragons. Does this red dragon know that the party is adventurers with incredible amounts of wealth? If so, it'll likely avoid obliterating them and their belongings (by dragging them down into lava). Does it not know, and just think they're random traveling humans? Then there's really no reason to obliterate them rather than, say, just eat them (as a tasty meal). Remember, red dragons are over-confident, and they might get themselves into trouble.
Aside from game fun, I consider this as a major reason why the dragon would not dump the PCs in lava. The dragon knows from the cultists that the group possesses some very valuable magic items. Neither the dragon nor the cultists know about the group's artefact, however. The evil fraction is well aware that the PCs are a dangerous group with a good array of combat options and arcane powers that exceed the cultists' and the dragon's options; this prevents the dragon from being overconfident. He may be arrogant, but he is not stupid to ignore the fact that this battle is going against guys that have shown their prowess and stepped on the Cult's toes. The evil guys also know that they have a good opportunity to catch the party by surprise, and the red dragon is the key to even the odds (so they hope).
However, the dragon will not fight to death. If the battle is going poorly for whatever reason, he will abandon the cultists to let them fight for themselves. The necromancer cultist will teleport away as soon as the dragon retreats (or if his own life is in danger), and report to his master about the battle.
In-game, Sorcerers don't choose their spells, and I assume the same would go for dragons. It's possible that it just never gained the Antimagic Field spell, and thus can't cast it, as you're proposing here. I suppose it could have some scrolls in its hoard, though, which it could always Teleport to and grab, if necessary.
Anyways, just some food for thought, more from the story-side than "lead hat and line of effect" side. Hope some of it helps someone reading it. As always, play what you like
Many thanks for your thoughts! True, I as the DM could always leave AMF out, and certainly not all dragons would/should have access to AMF. But my question still remains: why would I as a DM not give the dragon AMF, aside for game fun reasons?
Without AMF, the dragon would be less dangerous I assume; and with AMF, one PC is likely dead. Killing a PC because the DM can do so is poor DMing, IMO.
Using a bigger older dragon is an option, but I remember well a fight when the PCs battled a great wyrm white dragon in a nightly combat. The creature was overconfident and did its best to dish out damage, but it was forced to melee ground combat quickly by the wizard's Earthbind spell (movement reduced to 150 ft even on a successful save, but that dragon had bad luck and rolled a 1, so its fly speed was 0). From then on, the wizard and the cleric simply countered all dispel and exit spells of the dragon, while her buddies and the warmage did the damage (and they did a lot in one round). After 3 rounds of melee fight, the dragon surrendered. It did some damage to the PCs, but the party was not threatened seriously (my impression).
NewJeffCT said:
Why would a dragon have learned the spell in the first place if its centered inside itself and it wouldn't be able to cast that level of a spell until it's Very Old (it's a level 6 sorcerer spell, so a Red Dragon would "learn" it when it hits the Very Old age category and is Gargantuan in size). Not very useful if the spell is inside the dragon only, no?
Hrmm, this is a good point. I get the impression that AMF was not designed for creatures bigger than size M

. Guess I've to re-evaluate my AMF ruling.