I'm a good way through my no incap no chariot run and I've been keeping Jeunan on my roster ever since getting him (mostly for the story beats relevant in 3 but that's aside) and Dragoons have always been a unit I just wanted to love but can't. In my initial playthrough (which included postgame and about 2 thousand hours) I stopped using them pretty quickly after like, late 3 early 4, and usually when I'd run in to a dragon heavy encounter I'd just run a juggernaught or facetank the dragonscale. Playing through with these challenge rules, I have the same complaints that I had when I tried using them back then - they take too damn long to do the thing their entire class is specialized at doing at. If you don't have someone topping them off with an mp consumable (which is rare in this game), their first few turns are spent gathering the mp for the main thing that the wyrmknight should be good at, which comes online around turn 3 and by that point they're either on low hp or dead, or a lot of the damage has already done (in both ways)

I read a post long ago that suggested that they must've had higher defense since the last iteration of the game, but from my experience they never had any special kind of defense/vit. The biggest issue of my first run trying to use them was that they'd straight up get incapped before they got to the target because their armor was only slightly above a terror knight's (which are deceptively squishy - thats the price of being a caster-martial hybrid but hey they're sturdier than a rune fencer) - but then again I was running a lot of PotD during then, so my experience is probably colored by that. To that end though, I do believe they should have higher defense. Like a decent chunk higher than a knight - they don't get phalanx or guardian force so it'd ultimately be in context and not take away from the knight, not to mention the knight has healing spells and the dragoon doesn't which remains pretty relevant.

One thing I will say in their defense is that they're like, the only humanoid unit I can think of off the top of my head that gets both Siege and Rampart Aura which does has it's unique applications but Siege is so situational for it's cost that I don't use it outside of chokepoint maps (usually castle battles, which makes sense for the term lol). Aside from that, their weapon selection makes them great martials, they just don't have a lot to capitalize on that on it's own like the other martial classes do. Needing support to work isn't a bad thing here but when the support they need practically means "dump mp items on them" make it worse for me because those are more taxing than buff items unless you're 50-deep in potd and have your staffs (and even then you probably want that mp for your casters).

If I were to boost dragoons it'd be pretty much that. Just let them have a decently higher VIT. In KoL (which i have played, where their defense was second to the lich's) and from what I read about motbq they were able to use a single offensive spell, and while that'd be fine with me as far as I'm concerned in balance here, it wouldn't even be that useful for them unless you had someone topping them off with spellcraft while they had something like dragonsbane active - so I could take it or leave it.

Honestly, all of these thoughts are just making me want the existence of mod tools more.