Do you remember that freakishly huge Dragon WotC put out a few years back? I mean, next to an adventuring party that thing is like Godzilla. And really, why is it so big? How does something like that even fit in an ecology?
I think the inflation occurred as a byproduct of tying Hit Dice to size. And while this could be expounded on, suffice it to say I do not prescribe to that madness.
Back in the day, dragons were terrible and scary…and not necessarily giant. Take Khisanth, described as an ancient, huge black dragon. On top of radiating darkness and dragon fear, she has an array of spells and multiple uses of 64 hp damage breath attacks. This is death on wings…and she is relatively tiny! Larry Elmore, Clyde Caldwell, and Jeff Easley all illustrated her and in every instance she is this .