"lizard men ruled the earth.. also, they took power from the crab people"?
They could very much have borrowed them from TDE.
In TDE, there are several "ages", some of the older ones clearly forgotten in-game, in which dofferent races "ruled the world", the continent of Aventuria, that i. In this case.
The oldest [ruling races] are rumored to have been insectoids, and later lizards, actully, with the evil dragon of Pyrdakor, who proclaimed himseldf a "god", installing his very own "ruling race" of lizardmen.
Among the other, older "ruling races" were the trolls in Aventuria, nd the Elves.
Of Lizardpeople there is still quite good knowlege (as far as I know) within the continent of Mranor. The are said to have been rather … I call them "sauroids", called the Jharra.
So, to the pen & paper players with better knowledge of TDE and of Aventuria, this doesn't sound that odd as it might sound to you.
And about "crab people" … In TDE there actually *is* a race of "crab people" … the so-called "Hummerians" (don't quite know how to correctly translate this name … the "hummer" is the German word for the lobster :
http://en.wikipedia.org/wiki/Homarus )
And ... by the way ... we have quite a lot of RPG and fantasy settings containing lizardpeople ... only that in most of them they just have never been a "ruling race" or have been degraded into obscurity. They appear for example in Age Of Wonders, Divinity 1 ...