If Felicia could understand James, I think Jenny will, too. I mean, dragons are commonly known for their wisdom and/or cunning, and in some mythologies, are even highly revered as the wisest creatures in the land. That whole "dragons are evil monsters of fire and death" thing is mostly from old European fiction, which often involve the more evil-centric "chromatic" dragons, who really are little more than giant, fire-breathing winged lizards; hell, it seems rare to think a dragon would speak at all in those tales, much less have any sense of morality.
In short, yeah, I think they can communicate.
