If an undead mob is hit by an Ender Dragon’s breath attack - either breathing by the portal or a dragon fireball - it will take no damage, and will instead be healed. This is caused by the fact that both of these attacks take the form of Area Effect Clouds that simply use the instant_damage effect to deal damage, and undead are naturally healed by that effect.
This bug is related to MC-84595, as both are caused by the same underlying issue.
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Can confirm in the current snapshot 26.1.
It won’t be noticed most of the time in vanilla game play. However, in datapack development, we need the area effective cloud that can offer instant damage effect for all the mobs whether they’re undead or not, but no status effect can achieve this and it brings so much inconvenience!
So I suggest MOJANG making dragon breath damage its own effect, just similar to the wither, it damages all the mobs including the undead mobs 3 * (2^levels) amount. And then make dragon breath cloud offer this effect instead of instant damage.
Can confirm. Making dragon breath damage its own effect would also have benefits for datapacks and the like, since the present hardcoded behavior whereby undeads are healed by instant damage and damaged by instant health often interferes with attempts to give players options for AoE damage.