Dumb looking? Wow, how old are you? I thought that the animations used on the dragon and the whole model was exceptionally well done. I would definitely expect Skyrim's dragons to behave like this, perhaps even better.
I'm a dragon nut, and I think that dragon was poorly designed. That is to say not modeled badly, just not a very interesting design.
And if I remember I believe Project Offset was initially designed--well at least once Intel bought them--to push their technology. Which means the average PC would choke and die trying to play that. heh.
I can't see Skyrim's dragons being overly sophisticated, but who knows. I hope you guys are right. I would kill to see some dragons that really know how to move around the environment. And I want to see decent flight animations, not just wings flapping up and down. The wings should never just flap up and down. There is a very specific way wings move in flight. Well varies from animal to animal, but you know what I mean.
Cheers