Take the Vial of Preserved Dragonsblood, along with your daggers Fear and Vengeance, to Wrathion at Ravenholdt Manor in Hillsbrad Foothills.
<Zazzo performs an enchantment on the vial of blood, then quickly hands it back to you, as though it's toxic.>
Done! You'll want to get this back to Wrathion as soon as possible, along with those two daggers of yours.
I don't know what he plans to do with this stuff. Between you and me, sometimes that little dragon kid creeps me out. Good luck!