"Dragon of the We" eh?
And yes, this should have been put in the AAQGAA/FAQ/Tomtitan's thread. However, I have an answer anyway.
Iroh went looking for the dragons before Zuko was born. And he found them. He didn't kill them though, instead they taught him the true firebending and he lied to protect them. Since he claimed to have killed them, he was given the title "Dragon." I can imagine him comming home to all his firenation buddies asking about how he killed the dragons. He would have made up a story. I think he claimed to have done it using his breath of fire.
He got the title by "killing" the dragons, and he "killed" the dragons with his breath of fire. Therefore he got the title from his breath of fire.