The takeover happened after you saw the cutscene of the Dragon fighting Damian's dragon and getting shot down, and before you woke up with Zandalor greeting you.
I disagree. At the end of that scene Damian stomps on the head of the Dragon, presumably delivering the final blow. If it was the case that Damian was there when Ygerna infiltrated the Slayer's mind, he would have not been so surprised at the end asking her how she managed to free herself, when he was trying to accomplish just that.