Nice demo. Though the game frequently drops in FPS when exploring.
I have also made a voxel game, check it out if you want. :p
Feels satisfying to burn 100s of civilians in one breath.
The dragon's controls need fixing.
You could make the dragon's breath like a flamethrower, meaning you hold it down to constantly breathe fire. To make it less over powered, make the dragon have a fire gauge that drains slowly when breathing fire. It will regenerate back over time.