I really like the idea about adding a flying mount - and now after having tried it im not really a fan of the Q/E for descending/ascending. I belive that the mount should have free movement and flying in the direction that the mouse is pointing, it seems way to restrictive with using Q/E IMO. I know that this is probably already the wish for the developers, but due to having mountains etc. you want to restrict it to avoid falling through terrain etc. So I really hope that you will change that when you add the mount in the future. 

You could make it auto-dismount if you get to close to the ground, which would also make dismounting more intuitive. And if flying into mountains it would make sense that the mount takes damage and throws you of, making it up to the player to be able to control the dragon.

It's pretty close to underwater movement already, camera directional moving would make it match.

The "instant accel" seems to be a copy of Corsair's underwater accel/ turn into a mermaid. 

As for the rest, there are a lot of issues still. For now it was ok sight-seeing for a bit, then I forgot it was a thing already.

I think free movement was not implemented due to game engime limitations, or it caused other issues and this is a temporary/intermediate solution.