Shouldn't the dragon not being there, and being seen in other area, have reached them by now?
Or are they just assuming it is wandering and the Dragon will return to her nest soon enough?
The king is not paying attention, and I think just trusting what the idiot family members say, combined with a cult based on legends making assumptions.
Wasn't the situation that the little sister was near death and bedridden? So she was likely deemed worthless and ignored. Then once MC "healed" her by transforming her into a dragon, everyone was to enthralled with the dragon to care about the missing invalid.
Likely, why care or talk about the loser sick child... or that is how these "how can I use my kids to my advantage" types tend to think. Once the use is done, no longer in their head.