Hey it looks that we have some pitiful lizards squeezed between us.
My dwarves are of a mind to make them swallow their empty threats. The dwarves generally keep to themselves but when somebody provokes them and they decide to solve a problem, then they do the solving in a very basic way.
First to make kindling of everything including the lizards and then burn to the ground what is still left standing. To stay on the safe side, salt the scorched ground. Ah . Don't forget to stamp on the eggs too
As the lizards took a warlike (but very misguided) stance towards you, we might solve the problem together.

(Feel free to read the background of my civilisation in the country 28 thread)