Fantasy book with giant worms and dragons

Hi, I read in 1980, it was paperback at that time. Read it in California. Woman was orphaned somehow and had been found by giant worm like creatures called Fuzzies. She traveled by being wrapped in something protective and actually being inside the worm. They brought her across some body of water like an ocean to a place where there were other humans. The other human women despise her and she ends up hanging out with dragons that have a lair that you can only reach by diving down into a large pool of water.