Hey, if the dragon's family wants some action, bring it. Same trick would work on them too. I'll carpet my home base in red dragon leather.
Ultimately the strategy is exploiting the two glaring weaknesses of dragons: low touch AC and low Dexterity. Now, typically it's not a problem since most effects that inflict Dexterity damage or drain are either poisons with a fortitude save before they work, or spells that are subject to the dragon's extremely good SR. It just so happens that this one item manages to bypass both defences completely. I'll most likely get a pass on this strategy for the current encounter for creativity, then there'll be a houserule that it's banned from future games.
Frankly, I see it as fair turnaround for the DM throwing a creature at us that's 5 CR levels higher than the party average. It's pretty much expected that we'll have to find some loophole to defeat it, since there's zero chance of us surviving a straight up fight. If the intention was for a balanced encounter that involves standard combat, we should have been given a monster that was level appropriate. It's certainly not like I haven't investigated alternative methods of completing the encounter. I initially approached the dragon diplomatically, offered it a 1,000 gp tribute, stroking its ego and doing the best I could to attempt to have a nice peaceful chat. It demanded all my character's equipment instead, then tried to fry me with dragonbreath when I declined. So now we're at the point where only one of us is walking away alive, and I intend for that to be me and my party.
As for traps at the end, if the DM wants to play sore loser and screw us over on the loot, that's not something I can control so I'm not gonna worry about it. I'll still have the rogue check the horde over for traps and give it a good old scan with Detect Magic before we loot the thing though, because you can never be too paranoid.
I don't really know the circumstances of your game, but who's to say you're actually meant to fight the dragon? If there was a 100 foot tall frictionless pole in your path, would you complain that you can't climb it, or would you just go around it? I agree it's bullshit when a DM insists you must fight an impossible fight, but when you have other options, it's reasonable that some things are beyond your powers.
And it seems like you probably have other options, considering the fact that you seem to be able to go out and buy several doses of some obscure magic poison, so it doesn't sound like you're trapped there. (And, reasonably, you should have trouble trying to buy enough cockatrice grit in a short enough timeframe to do the job, but it sounds like your DM isn't one to limit abuse of magic marts).
And if you do try to go up against the dragon, no one here is saying you have to face it in a fair fight. But the opposition is more to you exploiting the system, rather than exploiting the current situation. Anyone can run Pun-Pun with a sufficiently lenient DM, but most people would consider any victories gained by such a character to be cheap. A good plan should be something that, even if DM doesn't allow it or it doesn't work, makes people think, "That was a pretty cool plan". The retelling of the story of how you implemented your plan should ideally require very little rules explanation for anyone who doesn't know the system.
Finally, something that bothers me a little personally is that your plans don't seem to really involve the rest of your party at all. If this is a recurring theme for you, I would discourage it, not only because most people don't like it when they have to sit back while someone else does all the cool stuff, but you lose a lot of strength when you make a plan as a member of a team and only count on your own.