I thinks at least partly due to survival instinct. The problem is that while our survival instincts are very old and well developed, our higher brain functions are much more recent, and consequently the two don't mix entirely perfectly with each other just yet.
Survival instincts rather sensibly deal with danger by having us either remove or destro the danger or avoid it altogether.
When presented with human psychology however, a few more options come into play.
Our survival instincts now have a tool that can convince the person the danger doesn't exist, or edit the details of how they view reality, so that the danger is no longer a problem.
Essentially our straightforward primitive instincts, which would previously opened a walnut by hitting it with a club, now have a sniper rifle to do the job. Resulting in many cases in overkill.
This is common of many delusions. A person subconsciously is choosing to edit reality, because in the version they choose the survival instincts tell them they are safe.
This makes a lot of sense, S_B. And the tool you mention, the perfect tool for the job, is language. There's actually a very nice illustration which follows from your analysis, about how how form sometimes triumphs over content. There's a certain view of the evolution of cognition in human beings which holds that the really adaptive role language played in our career over the past couple of million years was not so much communication amongst members of a group, but rather the ability to give structure (by linear sequencing and certain hierarchical relations amongst subgroups of words) to thought. Mostly when people think it's not the crisp series of connected ideas that fiction often presents, but a kind of swirling kaleidoscope of impressions, memories, images and whatnot; language serves thinking by proving a kind of structural lattice for it so that complex, coherent ideas can emerge from the normal chaos between our ears. The problem is, language is
too effective in a way. It is so good at what it does, and we're so dependent on it for thinking, that it can actually in a sense take over, so that we wind up not saying what we believe, but believing what we say. People wind up liking some story they've told so much that they can't believe it's not true—the `too good to be false' trap. And because language makes it so easy to represent past, future, or purely imaginary states of affairs, you wind up getting carte blanche to have things any way you like them... or feeling like you do anyway. This ties into qi-tah's point...
Of course they realise it's a crock! Otherwise why would they need to run around telling all and sundry how deadly they are? It's bluff, like a frill neck lizard puffing up to make itself seem bigger. And like lizards, they only puff up once they feel threatened... *sigh* It does seem to be rather a male thing, i've noticed. Now why would that be? :shrug:
Well, there are two things here. One of them is probably not too strange: if you just assume that male humans are going to be like other male primates, and male social mammals generally, you expect them to be hard-wired so that the physically larger members of the group, by and large the males, respond with hostile aggression to threats to the group. But the second point is the really disturbing one: the lizard you mention, and other animals that indulge in threat displays, only do so when they're in the presence of a real physical threat, or potential danger; once the danger is gone, the frill goes down, the cat's puffed-up fur returns to normal... all that size-display subsides. But human beings are able to live in a private world which is so far now from the physically immediate one that a threat can consist of a remark made long ago, or maybe only in one's imagination (as when worrying about what two colleagues or friends or whoever are saying about one), and so on.
Someone like the chap in the OP clearly has some major fear problem, some sense of being threatened by
something in the world, in spite of the fact that he's probably never been actually threatened in the sense that a prey animal would understand the notion, or anything close to it. The kind of magical thinking that S_B was talking about is kind of the price we pay for those higher-order mental functions working in tandem with some very ancient layers in the brain. If you think of it in those terms, then the `deadly fighting arts' line of rubbish of the sort mentioned in the OP is just the by-product of a kind of a poignant fact about our whole species—a few millimeters of cortex trying to give form and rationality to the millions of years of violence and terror built into the rest of the brain below it...