Maybe in 8th, but in 6/7th edition they were really strong. Especially the Tzeentch dragon with the 3++ against shooting. There was just a big tradeoff between having magic or monster lord, that usually was favoured for magic.
edit: and by very strong, I mean not un-killable, but so strong that it needed to be dealt, and one of the reasons those cannons (or 4 bolt throwers) were there to start with, were the (high) possibilites of facing a dragon, or some other strong monster such as stegadon, treeman, greater daemon or a steam tank.
The chaos dragon was particularly strong, because it was so hard to kill and there was hardly anything else in the army (common set-up was lord on dragon, one or two disc riding exalted champions, three chariots as core, some screamers and a hellcannon, (which was also very hard to kill and expensive). The army was very strong because of points denial, they didn't need to kill that much, because it was so hard to get more than few hundred victory points of them. I'd imagine the current dragon lords (especially when you can get two in 2000 points), would work in very similar fashion, though it changes things that it is in general more difficult to get points in this edition.