His hammer skill level is merely at Lv4, and its enormous power relies more on the core skill "Hammer Mastery Lv3".
As for whether Reine wanted to compete with this young Temple Knight for some sort of dominance?
Not really...
Firstly, there has to be something worth competing for.
For example, when we talk about "competing for favor", both parties should be vying for the affections of the opposite sex; only then does the competition have meaning.
Secondly, the parties involved in such a competition or attempt to assert dominance need to be of similar status or strength; otherwise, there's no competition, just as a rich man wouldn't compare wealth with a beggar.
In the current situation, this young Temple Knight, if you don't count the enhancement from Divine Arts, would absolutely not surpass the upper limit of a veteran knight in terms of strength.
To be honest, that level of strength was already becoming negligible in Reine's eyes.