He might drop it. You could block him from using the spell pretty easily though. I'd probably make it so that you can't take this piece of equipment from a unit with the normal spell; you could still steal it with the Esus specific spell, but in that case I think that the Dragon should go on a rampage.
You could still move the treasure, but it would require faster units, probably Recon or Cavalry. You would have to move it more slowly (or if you get lucky and it is a coastal city you can load the unit with the treasure into a ship. My modmod's new/changed summons could really help here too.)