Notch has come a long way with dragons since their first mention - what was once a blank, grey creature has become something incredible. Sporting some incredible detail (including a serious upgrade to the wing design from the first model), flight and the apparent ability to destroy blocks that it flies through, the dragon will certainly make waves when it finally hits the game!
Recent news also suggests that dragons will be SMP-compatible! A realm for the Endermen, dragons, enchantments and potions - what will come next? Check in often to find out!
mountain dragons - dark red - found in the overworld
grass dragons - same texture as the top face of as grass block - found in the overworld
(hopefully no) nether dragons - netherrack texture - found in the nether
True but ghasts only destroy blocks when they see the player.
The color matches.
Should be quite common in ender since its near to surface.