Dragons and Balrogs
I definately have to go with Balrogs. We know Balrogs were maiar. Dragons could have been Maiar since Tolkien wrote that other maiar were also corrupted by Melkor.
Gorthaur_cruel said that he thought balrogs were weaker because the same gandalf that defeated a Balrog was also almost killed be a few wargs in "The Hobbit" At that point in Tolkien's writing he hadn't written anything on Valar and Maiar. At that point I think Gandalf was portrayed as just a wizard. If Tolkien had written him as a maiar he could have easily killed a few wargs.
Tolkien's view of alot of things changed through out his writting. In his earlier writing Balrogs were not maiar. And there were alot of them. There were times when Tolkien said that Morgoth sent a host of Balrogs. In his earlier writing there were many Balrogs. Dragons were probably more powerful then. But later his view of Balrogs changed and Tolkien said that there were never more than 7 Balrogs and that they were maiar and alot stronger. That also explains how Glaurung had balrogs in his train.
Since there were so few Balrogs it explains why the Valar were driven back when the Dragons came. There were alot more Dragons so if they all came at the same time it would have been hard for the Valar since they were greatly out numbered. If there were only 7 Balrogs they wouldn't have been much trouble for the Valar. And because the Valar didn't have to fight all of them because Glorfindel and Ecthelion also slew one each. Gandalf killed one later so the Valar only killed about 3 or 4. Because the Dragons are also very powerful the Valar would have had more trouble then because there were so many more Dragons.
Another reason I think Balrogs are stonger is because Tolkien wrote that the elves feared the Balrog of moria greater than anyone but he who sits in the Dark tower. (Sauron)
In the Silmarillion Tolkien says that other than Sauron, Gothmog was Melkor's strongest slave (for lack of a better word)
I think that Balrogs are definatley stronger, but I would like to here more reasons from either side of this debate.
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