He does see the joke. He also knows himself well enough to know that she'd almost certainly be able to beat him, especially in the only half-serious, half-flirting arguments he's likely to actually start with her.

If it were something serious—making sure she takes care of herself—he might be more inclined to hold his ground.

"Why not?" he says, his gaze traveling to the board. "Seems like it should be pretty well matched."