Designated Villain: We're supposed to side against the Dragon simply because the smoke from his snoring is endangering Equestria. Some of the Mane Six, especially Rainbow Dash, treat him like a villain although he clearly never means any harm unless provoked. It doesn't help when Rarity tries to steal his hoard and Rainbow Dash kicks him in the face. When Fluttershy gives him a talking to, he's more than willing to comply.
Ensemble Darkhorse: Again, the Dragon gets this treatment for being one of the most sympathetically portrayed ones (other than Spike and Princess Ember) on the show. He just wants to sleep instead of actually cause any destruction, he actually responds positively to Rarity (until he realizes she's trying to steal from him), he only becomes violent when Rainbow kicks him first, and he ultimately proves to be willing to listen to reason when Fluttershy stands up to him.
Fluttershy is correct in asserting that Spike's not a huge, gigantic, terrifying, enormous, teeth-gnashing, sharp-scale-having, horn-wearing, smoke-snoring, could-eat-a-pony-in-one-bite, totally-all-grown-up dragon. Except later, he becomes just that.
At one point, Fluttershy says, "This is a time for panic!" Pinkie, not listening to her, says, "I'm going to need balloons!" In "It's About Time", she uses balloons to panic.