Cheese Dragons are not actually alive. They are enchanted items of food that act almost identically to dragons. They have no need to eat, but they must “live” in humid environments or they will dry out and harden.

Try as he might, Holely Cheddar just can't fit in. It tried swimming with the Water dragons, but almost ended up drowning. It attempted to live in a desert, which almost resulted in its becoming a dried up husk of something that only vaguely resembled a dragon. In desperation, and at the end of its tether, Cheddar even asked Radiant Lute to help it find a mate. At least then, Cheddar reasoned, it would feel a little more like a real dragon, even if it can't sire offspring. Unfortunately for Cheddar, the mate chosen for it was one of the Magi dragons, who promptly tried to eat it.