Just some ideas:

You might start with some plain papier mache helmet-type masks that fit each student, then have them build onto them with 'skeletons' of cardboard strips glued on edge to form the basic structure.  Sheet insulation foam may be another way to build up the form (cut with serrated knives).  Then PM over the skeleton, dry well and paint. 

Most of the dragons I've seen seem to have their mouths open, so they could design the masks so they would be looking out the mouth.

We would love to see photos of the results here at the Visitor's Gallery!

Sue