The word "dictionary" appears in the definition of "dictionary" because it's the best way to describe what a dictionary *is*. A dictionary is a book that contains a list of words (and their definitions).
Here's how the circularity works:
* Definition: A dictionary is a book of words and their definitions.
* Within the definition: The word "dictionary" is used to describe the book itself.
It seems like it goes in circles, but it's actually a useful way to define the concept. We can understand what a dictionary is by knowing that it contains words, including the word "dictionary" itself.