When the dark elf player saw the half-elf gaining unusual powers, he assumed that I was ripping off of Baldur's Gate. He figured that there was probably some cult trying to revive an evil deity of some sort, and that her character would probably be wanted by said cult for sacrifice fodder. That's more-or-less correct. I'll include the full story in the spoiler.
The Coming of Seradess
Forgotten Realms Lore: At the very beginning of the world, dragons ruled the world and all the creatures within. Lesser races, like elves, were usually enslaved and unable to build lasting kingdoms or empires because of the dragons. So six great elven wizards got together and created the Dracorage Mythal -- a powerful elven magic that alters reality itself -- and tied it to the King-Killer Star. Thereafter, whenever the King-Killer Star is in the sky dragons everywhere go insane. The insanity lasts for several weeks, with the dragons killing their offspring, turning on their minions, crushing their own empires, etc. The star returns every 200 years or so, which was enough of a disruption that the reign of the dragons was broken, and lesser races began to thrive.
My Addition: Seradess was the major dragon deity of justice. She was moved by her followers' pleas for revenge against the elves, and determined that the elves had perpetuated a great injustice against the race of dragons. The only way to make things right, she reasoned, was to find a way in which the elves themselves would share in the fate of dragonkind. Working in secret, her church kidnapped direct descendants of the six elven wizards, and infused each of them with the blood of a slain dragon, sacrificed willingly to the cause. In order to get the fusion to stick, however, she also had to sacrifice a good portion of her own divine essence to the experiment. Before she could complete her vengeance, however, she was discovered by Bahamut and the other dragon deities, whose pride could not allow the unnatural fusing of dragonblood into a lower race.
There was a terrible fight. Bahamut eventually destroyed Seradess, however, and cast her remains to the earth as a burning meteor of liquid metal. In this way, Bahamut assumed Seradess' portfolio of Justice. The elves pleaded for their lives and Bahamut, who is really a very kind god, merely sealed away their dragon essence so that it could not harm (or benefit) them. This was over 50,000 years ago.
In the present day, The Cult of the Dragon is on the move. This is an insane group of wizards/necromancers who believe that "dead dragons will one day rule the world." They have discovered the remainder of Seradess' body (a large, misshapen chunk of metal) and have begun kidnapping elves from across the Realms in an effort to resurrect her as a dracolich. So much time has passed, that the dragonblood (and Seradess' essence) has been bred into nearly every elf (and nearly every dark elf, but they don't know that). The Cult must sacrifice many elves (on the order of 6000), to accumulate enough of Seradess' divine essence that the ritual will work. They also need a live dragon (preferably willing) to become the host for her spirit reborn.
Once Seradess is reborn, she will reactivate the dragon blood in all elvenkind, causing them to go insane at the next rise of the King Killer Star. What's more, elves of direct descent from the six wizards are so tainted, that they will lose their will entirely to Seradess, becoming horrific half elf/half dragon shock troops under her complete command.