On the other hand, voidsent seem to have no trouble possessing dragon corpses, as evidenced by the sheer number of dragon zombies that tend to crop up. So I wouldn't be surprised if, at the very least, the same was true for Ascians. But I'd wager only an Overlord could possess a live dragon, and the Great Wyrms might be impossible to possess if their souls are as robust as Midgardsormr's.

As for why they've apparently never done it, maybe infiltrating dragon society would be exceedingly difficult compared to the alternatives. Or maybe, as extraterrestrial invaders handed dominion of the star by Hydaelyn, the Ascians simply hated them too much to even consider it. Or maybe dragon's eyes acting as a sort of natural auracite meant they'd get Lahabrea'd if they weren't careful around dragons.

Or something else entirely. Who can say?