The Cow-Dragon is a monstrous and aggressive creature that breaths cheese. It is actually Herbert and Wally in a costume.
The Cow-Dragon first showed up by shooting cheese at the citizens of Bumblyburg Park and eating everyone's picnics. Larry-Boy came to stop it, but was showered by the cheese slices. He stops the creature by using his radar guided spatula and captured the ferocious creature, but only to reveal that it's just a costume and Herbert and Wally were in it. Their excuse was that they were hungry, with Larry-Boy confused on why they can't just eat the cheese instead of shooting it. They were ashamed, were send to jail by Officer Olaf, but were released sometime later.
In Larry-Cave Exploration, the costume was still in the jail.