Although classified as a sword, The Dragon Claw is actually the severed arm of a Red Dragon, with an exposed bone acting as the hilt. It is presumably wielded like a club, relying on its weight and the sharp claws at the end of the arm to do most of the damage.
The Dragon Claw is a support weapon that relies on stacking Poison to slowly neutralize enemies. It gives Matt a decent boost to his Attack and Magic Attack, can cast Toxic with certain skills, and allows Matt to counter with Normal Attack, which can also cast Toxic. Unfortunately, this weapon can also Poison its wielder at the start of each turn. Additionally, it raises Matt's Fire and Poison resistances.
Epic Battle Fantasy 4
The Dragon Claw is found in a chest to the right of the ice cave in the Temple of Godcat.