No, a dragon is in almost all cases considerably less good in combat
than two giant birds (and it can't fly). In most cases the combat value
of a balanced piece (attack = defense) scales roughly as the square root
of its strength.
I also think that the effect on game balance if dragons did not exist
and everyone was breeding giant birds instead, would be virtually nil.
-- Copyright 1995 David desJardins. Unlimited permission is granted to quote from this posting for non-commercial use as long as attribution is given.