I'm not sure where your problem is, so here's just a quick run through of making the Cave in to a Dragoon. All but the sprites.dat settings are potential problems preventing the unit from moving and attacking correctly, and the sprites.dat settings may be why health is displaying incorrectly (if I understand the problem).
In units.dat in the Basic tab make sure Has Shields is correct and the weapons are all correct. Make sure the appropriate values in the Advanced tab are set, key points are to make sure the Building flag is unchecked, Battle Reactions checked , Full Auto-Attack checked, and the movement flags are correct (dragoon has 0x1 checked). In the AI Actions tab all three Idles and the Attack Move should say Guard (Normal), and Attack Unit should say Attack Unit (Normal). Right click Action should be Normal Movement/Normal Attack.
In flingy.dat, make sure you set Move Control to Iscript.bin Control.
Hit the 'jump' button to go to the appropriate sprites.dat entry.
In sprites.dat, set your selection circle and health bar values. (Dragoon default is Sel. Circle 2, Health Bar 31, Vert. Position 9).
Hit Jump again to go to the Images.dat entry.
In images.dat, set the Remapping Function to 0 (Normal Draw), and the Remapping to 0 (No remapping). Check Clickable and Use Full Iscript.
And finally you may want to use Firegraft to give the Cave the Basic Commands button set so you can control it with more than just right clicking or as a group.
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