......generally buff and melee. He's immune to Water & Body Magic, and in general MM7 attacking spells aren't that powerful - certainly not for a quest boss dragon. Shrapmetal is the classic exception to this, but in MM7 this only applies to the Dark path, and generally only becomes uber with GM Dark Magic and lots of points in the skill.Otherwise, max all your buffs - Bless, Heroism, Shield, Regen, Protection from Water etc - and just beat on him. There is a theory that real-time combat is better than turn-based as the opponent's reaction to the previous blow can create a window for the next character to slip ahead of the "action clock" and get the next hit in, whereas in TB, the opponent will always get their turn in the proper order. So keep that Attack key pressed in RT and if one of your characters goes down, drop into TB to heal until they're back up, then go back to RT.
If this doesn't work, try upping your skills for a few levels - especially to increase some crucial buffs from Basic to Expert or Master - and come back.
Good luck!