Here is the thing: Adding fossils means people will want dinosaurs, however being able to bring dinosaurs back to life means adding even more technology to the game, something most people don’t want, as they like how Mesecraft kinda has a fantasy feel to it, adding more modern equipment will take away from that. However something that’s already established is magic, maybe you can bring dinosaurs back to life with some magic staff, maybe the Druid’s staff, as many people see that staff as being really useless, and it also already has the ability to bring dead grass to life again, so that means it must also have the ability to bring other things back to life as well.
Another idea if you want dinosaurs or other unique creatures is that we have a really deep underground cave biome. This cave biome, called the Primordial Jungle, is one of the most breathtaking biomes in the whole game. One thing about this biome is that, since it’s an underground jungle, it has lots of unique light sources, glowing fruits, and some other cool glowing and non-glowing flora. However, this biome only seems to have one natural spawning animal in it and that is the giant cave spider, which is found everywhere else underground, but seems to spawn here more frequently. But I think adding things like small or medium sized dinosaurs to this biome would be super cool, as it would bring more life to it and give you even more reason to want to get down here. I do think that there should only be 3-5 dinosaurs, as any over that would be too much.
But what if you want water dinos? Well there is another deep cave biome that’s a little bit higher than the Primordial that is the perfect place for this. That is the Sunless Sea. At the moment the sunless sea is kinda empty and most people come down here for the crystals and easy diamonds which can be found in the intertwining rivers which connect to the massive underground oceans. But the oceans themselves really need life besides snare-weed, some types of coral, and cave crocs. This is where water dinos and other unique water creatures can go.
And that is why I think things like collecting DnA for dinos would just be a bad idea as not only is it a complicated one and one that many people would not be able to figure out, there are many deep cave biomes that need life that these dinos can bring. I do think fossils could work, as they would be a cool tease, but bringing them back to life with their DnA and machinery would just be a waste of cool content.