While I agree that, for the sheer science of the matter that they should have kept the DNA of the dinosaurs, I'm not entirely convinced that dinosaur morphs would be so useful as to win the war. (Then again, it seems like all Yeerks have absolutely no idea how to aim a gun...but I digress...)
Using such a large and unusual morph would cause a lot of problems.
-It would be nearly impossible to keep the war under wraps.
-Now not only do you have the Yeerks after you, you have every human scientist on the planet looking for you and trying to capture you.
-You wouldn't fit into a lot of places, possibly even the Yeerk pool (depending on how deep the cave is.)
-It's probably very hard to be precise with a dinosaur morph, which would lead to a total Cassie meltdown after you accidentally chomped three other people along with your target.
-With a morph that large, its going to be hard to be agile, which would mean a swarm of Hork'Bajir would probably take you down faster than something like a Tiger Morph.
-I think that Visser three would have a morph that could take out a Dinosaur...I mean, he had a freakin dragon. (The Nartec, maybe it wasn't exactly a dragon, but it breathed fire, lol.)