Do you find that with the Dragon Expansion characters more powerful?
I found the expansion as a whole to be amazingly out-of-balance with the rest of the game. The characters and events seemed only balanced with respect to themselves.

My suggestion is to remove all the characters and event cards. One possible compromise that might be reasonable is to shuffle the events into the deck only once a player has passed into the middle region. Likewise you could allow a player who has died to choose their second character from the Dragon Expansion characters.

This is all presuming you are talking about Talisman 2nd Edition and Talisman Dragons.