I had the same issue too. Here's how to fix it (this results in quest completing as you killing the dragon as it should):
1. Get IEMod for the extra console commands: http://rien-ici.com/iemod/
2. Open up ye olde console (~).
3. SetGlobalValue n_Nest_dragon_State 1
4. ForceAdvanceQuest data/quests/12_twin_elms_oldsong/12_qst_nest_above_the_clouds.quest
Proceed back to the temple and pray to Hylea again.
The bug is that n_Nest_dragon_State does not get set properly when selecting the aggressive option right away and engaging the dragon.
Note: You can tweak n_Nest_quest_main (1 = acquired, 2 = reached top, 3 = dealt with dragon) instead of complete the quest peacefully.
