Level: Crystal Caves.

NOTE: The Trophy description is wrong. You do NOT have to do it during the dragon boss fight. You can simply go to the boss area after the boss fight and hit ground to make crystals drop. Doesn't have to be during boss fight (this is important because the boss cannot be summoned again once you used both Dragon Gems and finished the level). Hence it's not a missable trophy.The Dragon is a mandatory story boss. It requires 2 x Dragon Gem to summon the boss.

Dragon Gem #1: Found in "The Pumpkin Serpent" - after defeating the Pumpkin King (level boss), use the Witch Talisman on the Witch Cauldron at the start of the level. The Witch Talisman is found in "Cemetery Hill" and you'll get it in the same place where that level's Chalice is found (break boulder on right side with hammer/club to enter witch cave, light club on fire and then hit the center piece in the prison room to reach the Witch Talisman).

Dragon Gem #2: Found in "Inside the Asylum" - in the cage where the mayor is being trapped in. You go talk to him at the end of the level, can't miss him.
Now that you have 2 x Dragon Gems, load up the level "Crystal Caves". In the area after using the green earth rune, there's a waterfall you can enter. Behind it you find you dragon cave, press Touchpad at the dragon stone head and select the Dragon Gems.

This summons the dragon and starts the boss fight. This is where you get the trophy! The boss area is split into 4 areas, each has different colored crystals on the floor that correspond with the crystals on the ceiling (red, green, dark blue, bright blue). For this trophy the green crystal works nicely. When you hit the floor with green crystals (top right), it will drop crystals where the green crystal is on the ceiling (bottom right). Hit the floor in top right area with the club, then quickly run to bottom right area and let a green crystal fall onto your head.

Remember: If you already killed the dragon and finished the level, you can simply go back to the cave (even if no dragon is there) to make crystals drop on your head.