It’s possible (yeah I know, a vague start, to an equally vague topic) that the "ghost dragon’’ was a hologram, or projection of Lagi’s appearance, that was somehow sent from crest to guide Edge to the location of the baby dragon. If you look at that screenshot you posted, there’s lightning beams joining the dragon to the roof the tunnel… maybe it was projecting an image of the blue dragon. The image might have been projected from the crest, through the Shelcoof - perhaps left behind by Lagi as a guide for the Divine Visitor, years after the end of Panzer Dragoon Zwei.
Also, notice the energy orbs around the dragon… it looks a lot like the dragon is composed of pure light/energy, like the dragon phoenix spell. I’ve always thought of the dragon phoenix as just an illusion that the dragon creates, so perhaps the ghost dragon is similar in nature?
After all the discussions we had about the baby dragon’s origins, I’ve now become convinced that it really was Lagi, the dragon from PD Zwei. That would mean that the dragon in PD 1 wasn’t Lagi, but a different dragon. While it would make sense that this dragon originated from another Coolia and made his evolution towards the blue dragon form, I think there’s another possibility.
I’ve never understood why Sestren would say “D-Type 01 activated” and activate the Dark Dragon, since it was always Type 02 in PD Zwei and Saga. Somehow, I think there’s a real possibility that Sestren activated the original blue dragon, the one that was always meant to be activated as a host for the Heresy program. Sestren may have been a very advanced AI but he still acted like a program, following predetermined procedures that were set in the Ancient Age. Somehow, the “Impurity” may have used this “flaw”, causing Sestren to release a dragon that would turn against him.