why sauron cant breed werewolves/dragons?

[Alfirin]

I think there may also be a breeding stock issue. I'm going by the words of my A-Z of Tolkein (which is not always all that accurate) but I seem to recall that the main difference between Wolves and Werewolves in ME is that wolves are basic biological creatures, whereas Werewolves are actually minor spirits of Arda (i.e. Maiar) brought over by Morgoth who took the forms of wolves in ME. Sauron was Commander of the Werewolves, but I'm not sure he was their creator (in the same way he could command Orcs, but did not make them.) In otherwords, to make a werewolf, you have to have Maiar under your command. And Sauron, a Maiar himself, doesn't, he just isn't that powerful. In all likelyhood by the third age Sauron would not be able to turn HIMSELF into a werewolf (like it used to be able to do). Also based on those other rare occasions where we see Maiar having children in ME (like Melian), thier offspring are not themselves Maiar, though they may have some "boost" due to thier Maiar blood. So in all likelyhood, the spawn of werewolves would be ordinary wolves, though possibly of greater than normal size and power (actuallty, since we don't here of them before the Third age, maybe that what Wargs are biolocally, the spawn and decendants of the spawn of the werewolves Sauron had under his command before.) Any werewolves Sauron still had in the Third Age would likely be ones who escaped the massacre on Tol-um-Gauroth or were not actually there when it occured (Maiar usually don't die of old age, so any werewolves who were not killed would likey keep going on) who would be few and sparse (which would explain why they play no large part in his attack plans.)
Dragons would have a similar problem. It is said that Smaug was the last of the great dragons. Who would one breed with him? A cold-drake hen from the ones that pestered the dwarves? Even going back further Great dragons seem to have become a little sparse post-Morgoth. Given how much creatures seem to have diminished by the Third Age, the possible dragon breeding stock was probably too weak to give a likelyhood of spawning extra Smaug's or even dragons close enough to him in power to be useful. Sauron was lucky to find the nest of Fell Beasts in the Mountains of the Moon (who, based on their description, could be some sort of dragon kin biologically) and as far as we know, he couldn't even get THEM to reproduce (or why he had such limited numbers, and was not fielding a full Mordorian Airforce.)

[Zigûr]

Originally Posted by Alfirin

I'm going by the words of my A-Z of Tolkein (which is not always all that accurate)

David Day's "A to Z of Tolkien" or Robert Foster's "Complete Guide to Middle-earth" which is sometimes introduced with the line "Tolkien's world from A to Z"? Because the former (David Day) is not to be trusted. This is to a degree accurate, but it's just general advice about Day. He as good as claims outright that Sauron was literally a big eye (which he wasn't) and that Bombadil was a Maia (which he almost certainly wasn't).

Sauron was lucky to find the nest of Fell Beasts in the Mountains of the Moon

I believe the phrasing that the winged steeds of the Nazgûl derived from "forgotten mountains cold beneath the Moon" is a figure of speech rather than an item of geography.
I always considered those creatures to be birds rather than reptilian in any event. I know birds are descended from reptiles, but in any event they do not seem like close relations of dragons to my mind.

[mhagain]

For the Fell Beasts see Letter 211:

I did not intend the steed of the Witch-King to be what is now called a 'pterodactyl', and often is drawn (with rather less shadowy evidence than lies behind many monsters of the new and fascinating semi-scientific mythology of the 'Prehistoric'). But obviously it is pterodactylic and owes much to the new mythology, and its description even provides a sort of way in which it could be a last survivor of older geological eras.

Of course the letters can reflect fleeting concepts that may be subsequently revised when Tolkien has more time to think about things, and can contain errors based on misremembered info, but in this case it seems as valid an interpretation as any.

Maiar are - pendantically speaking - not "minor spirits of Arda" because the Maiar are in origin Ainur, who came from outside of Arda. There's a distinction in Tolkien between beings bounded to Ea and those not.

Hmmm. I wonder did the "everything must be a Maia" trope originate with David Day? It would certainly explain a lot.

Sauron in the First Age was certainly capable of creating werewolves, per Beren and Lúthien:

Therefore an army was sent against him under the command of Sauron; and Sauron brought werewolves, fell beasts inhabited by dreadful spirits that he had imprisoned in their bodies.

Of course David Day would probably claim that these spirits were Maiar too...

We have an example of Morgoth creating a werewolf, also in Beren and Lúthien:

...he chose one from among the whelps of the race of Draugluin; and he fed him with his own hand upon living flesh, and put his power upon him. Swiftly the wolf grew, until he could creep into no den, but lay huge and hungry before the feet of Morgoth. There the fire and anguish of hell entered into him, and he became filled with a devouring spirit, tormented, terrible, and strong.

Tolkien doesn't say it anywhere, but I imagine that a similar process was involved in creating the dragons.