1) either game is too easy, or you do not feel like a all powerful dragon, Master/Lord of the Skies etc. because everything would be able to kill your dragon
Noone said everything could hurt you in dragon form. Also the feel "of being someone" is very personal. Each player cares about different things and I dont want to draw into personal preferences. Here we talk about opinions of several features/game content, not feelings.
2) Human form would be at a severe disadvantaged and you could lose the sense of being a Dragon Knight, rather then a Dragon(many arguments to this, I know).
Not true. There were already written many options to balance it. I wont repeat them again. One of them is cooldown - you cant change to dragon all the time. And EXP penalty for using dragon is also possibility - it was already mentioned.
Its mainly matter of budget and design decision (should we expand this dragon feature in next episodes or not?). It would be probably best if someone from Larian would be so kind (and courageous

) and comment ideas in this topic (especially from first posts). Virumor, Greever, Lar, anyone who needs a little break from work on D2 expansion?