The story
She let her sister have the prince. The dwarf she married instead is the Elven King.
Vera knows that marrying the Crown Prince means a future of nothing but humiliation. So when her sister goes after him, Vera lets her have him and weds a dwarf instead. The dwarf turns out to be the Elven King. Vera's honesty wins him over, and the bride everyone looked down on becomes a queen. Her sister isn't so lucky. She's banished to live among the Dragons, and now she's the one living the fate she created.