Since it's optional, the Drake is meant to be way harder than anything the player encounters normally. You need top gear, good party composition and high level to beat it, and I suggest only to try it after finishing the main quest so far.
I have to say that I do not put anything into the game that I haven't beaten myself, so it is perfectly possible. The drake does indeed do a lot of AoE damage, but I partly blame RPG Maker's combat system for this. It really does not provide tools to make hard battles "interestingly challenging", so it often just boils down to "this boss just does a lot of damage". I guess technically the boss's damage could be toned down and make it do more status effects etc, but it is what it is.