If I'm honest, I'd have to say Dinosaurs, purely based on the fact that they actually existed while Dragons are pure fantasy. However, everyone has their own preference

Why not both

Wasn't there something similar to this a while ago?
I remember arguing with someone about exactly this question...

How about including both in a game? Dragons being territorial, would protect certain biomes/structures, while dinosaurs would be more like wildlife... they are just there.

Dragons. No contest. No matter where they come from, they are awesome.

They'd both be dangerous, and also you didn't clearly specify a dragon, if you would mean gods like chinese dragons, regular movie fire breathing dragons like European dragons, or the 3 headed hydra, anyway for this topic I'm gonna be assuming you mean the European dragon, and so I would prefer that as they could easily be maintained unless they have their signature fire ability, this would make us discover substances like tungsten to withstand these heats and even so you would literally be burnt through the tungsten. And so that's why we have rifles, pistols, tanks, stuff like that so we'd have more of advantage, but I generally think people would be more interested in seeing a dragon, not only that you could probably train a dragon if you can convince it. Now, on the other hand, dinosaurs, are cool, but they aren't portrayed in movies, meaning literally all dinosaurs would have feathers and that would make our expectations high but results are low, but dinosaurs are still good for amusement park rides and zoos. Overall I think I would like dragons more than dinosaurs, the conversation ended.

Dragons can potentially be as if not more diverse than dinosaurs, plus a wider array of abilities commonly attributed to their species. Plus mythical. The choice is clear.