Its a nice looking creature, and a pretty serious threat.
HPs and Defences
From my own personal experience and philosophy I would:
a: Change its AC back to 32 (from 30). A group of PCs have plenty of powers to reduce a solo's AC or buff their own attack values so the standard AC of 32 should be fine (or more accurately - pretty easy for the PCs to hit).
b: Change the HPs back to the expected 955 or 960 (from 738). In my experience the PCs can dole out a tremendous amount of damage, so much that a creature with a lot of powers might not actually get a chance to use them all. The change from 738 to 960 HPs might buy the creature 1 more round, 2 if its lucky.
Depending on the level of the PCs I might be inclined to actually increase the HPs by up to 50%. But it would be foolish of me to suggest that this would be appropriate for all groups. So that would depend on your groups make up, power level and game style.
Hmmm...the reduction in hp is completely in line with the Solo creation rules with MM2. I don't want the fight to last longer...I want it to be more exciting. Which explains some of the later stuff (actually, some of this explanation is on my blog).
Tail Strike
"Immediate reaction - when an enemy moves or is in a position where it flanks the dragon"
This is a little vague and open to interpretation, either:
a: give it threatening reach (3) with this attack
b: give it a reaction when an enemy moves into a position where he flanks the dragon
c: give it both
Actually I think you mean both (option c), maybe you intend it to be a weaker version of threatening reach?
Never really thought about Threatening Reach. The point is to give the dragon one more opportunity to attack when it's on the ground.
Breath Weapon
The damage from this is off the scale, maximum expected damage from a limited attack is 4d12+7, this attack is 6d12+16 with half damage on a miss.
This seems a little too much for a recharge attack, if it was an encounter power or single target attack I wouldn't be as worried. As a recharge power that targets 3 enemies I think it might want pegging back a bit.
Nope, this is very intentional. I _want_ lots of damage from this attack. IMO, monster damage doesn't scale up fast enough. My PC's are very good, and have been having a very easy time lately. It's even worse for Solos.
There's been lots of discussion about this on the blogosphere (also check out Chatty DM and Sly Flourish, as well as the latest podcast from Radio Free Hommlet).
Thunderclap
Knocked prone and dazed (without a the chance of an early bonus save from an ally) is a nasty combo, and pretty much the equivalent of a stun. Its true that PCs can attack from prone, but this attack is a very good control power for the dragon.
I am not sure I would say its overpowered because I can see the dragon needing to disengage from melee and this power would help it do that. It could also achieve this with a push and knock prone, or daze only attack.
It's actually a downgrade from the Elder Blue Dragon (which does a stun, not dazed). Stunning generally isn't fun, and this power as you say, is to enable the dragon to disengage. It also does very little damage, which is a big incentive not to use it if it doesn't have to.
Unstoppable Villain
Correct me if I'm wrong but doesn't this power actually hinder the dragon instead of helping it?
If it loses its standard action when dazed it cannot make any attacks when otherwise it could have done!
I would reword this power to only work when it was stunned.
Remember it does have it's aura, and would still get it's minor action attack too. So it still gets lots of attacks, but dazes at least would delay the breath weapon, which the PCs would really not want to see a lot of.
Well those are my initial thoughts, I hope they help.
Yes, thanks for the feedback!