When facing high-level (eg. level 100 on the 'Islands') Ruby Dragons, the problem most people run into is getting their whole party destroyed entirely by a single Breath attack, therefore I recommend having considerably strong magic Junctioned to the Vit stat of your characters, and/or Junctioning Vit+% abilities. And yes, Breath is considered a physical attack, so Vit, rather than Spr, is the deciding factor in the damage said attack causes.

Even when many players have their Squall set up to deal 10,000 damage with each hit of the Renzokuken, a Ruby Dragon on the initiative can make short work of him. If you are able to survive a Breath attack though, and still have the ability to dish out that kind of damage, Ruby Dragons should cause you much less trouble.

As for how to set up your party offensively, there are numerous strategies floating around that pertain to that, and a few good ones have already been mentioned in this thread (I particularly like the Break idea ).