Heroes 5.5 WarGame Edition - Tactical Edition.

and why haven't these kinds of creatures wiped out all life yet?

It's simply that they can't fly or move around in general, and when it comes to obtaining food, they have to rely on smaller dragons (it reminds me of "How to Train Your Dragon"). The idea can be developed further...
In general, magic is not only a normal but, in my opinion, a fundamentally important explanation for how a dragon can fly. However, simply using the word "magic" isn't enough; we need to explain more clearly how it helps. But if a dragon can breathe fire and even cover itself entirely in fire, surely magic can't help it fly?
In one world (which exists 90% in my head, hehe), dragons are powerful elemental mages (air, fire, earth, water). Accordingly, only the first two types can fly (their magic is suitable for this), while the others choose different means of transportation (mostly). Earth dragons move through the earth, for example, and have a suitable elongated body with reduced wings (they resemble Chinese dragons).
What I'm getting at is this: if you put some effort into it, any game element, even something as simple as "This is magic!", can be made quite lore-friendly and not seem so paradoxical, and interesting consequences will emerge.