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I read the animating flyers tutorial and I was wondering if I should try to animate a dragon as a vehicle or a unit. Vehicle sounds simpler and it would be my first choice, but I'd like to have more 'livley' flying animations then just wings open at takeoff and close at landing. For example, they might flap it bit during flight. I think this is doable when you look at the tauntaun (sp?). Any ideas?

Better yet have a look at the Geonosians.
From making butterflies out of them I know you can change the wings and have a non-fly position as well.

you should make it a vehicle, if you make it a unit you need about 30 anims for it (if it has a skeleton that strongly differs from the units, what i id assume) if you make it a vehicle you can give it a takeoffanim, flapping wings (through an effect used as exhausteffect) and a finanimation (animation played, when flying up, down, left etc.)

Seems to me like it would behave very static as a vehicle, I'd just go the distance and commit to a full animation set for best look.