Combat and gameplay mechanics in DD were sort of like Diablo (isometric view, point and click or click and hold to move, right click to use active skill/spell), but with actual quests, rather than straight kill or fedex. The demo (400MB) should still be around somewhere.
There were no dragon knights in DD. There were dragon riders, though with relatively small dragons (horse sized, and low/slow flying). The only full sized dragon was Patriarch (presumably the same one as in D2:ED), but you just got a conversation with him (though you could get a skill and weapon from him if you chose your words carefully).