All in all, a nicely written mod. But, for it and maybe some others down the road, instead of setting the outputs as you have, (IE, only having it a several words, before going to the next) break them down into sentences.
As at start the each of an output, when a translator wishes to do this, it will show a t in the middle of the sentence, which is why we mainly do them at the beginning of the sentence.
Some glaring errors though:
$maxgold = get_module_setting("maxgold") * $session['user']['level'] * (($session['user']['dk']+1)*0.5);
Should be:
$maxgold = get_module_setting("maxgold") * $session['user']['level'] * (($session['user']['dragonkills']+1)*0.5);
As I do not believe DK is an existant field. If you were going for "seendragon" which is the setting for when they see the dragon, then use that.
$session['user']['gold'] = $session['user']['gold'] + $gold;
Could just be:
$session['user']['gold']+=$gold;
To handle the fight code, it is best to look at another Forest Event that handles a battle within it.