Asphere
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Anyone? This is moving pretty far down the list. My player just added this template when he leveled to 8 because hero lab let him. I noticed hero lab also let the damn snack become a bard as well though. I thought that the half-dragon template changed the type from "animal" to "dragon" which was not allowed but I can't find the rule to back it up. He seems really overpowered and as soon as it gets its extra attack it will do incredible amounts of damaged.
| Matrix Dragon |
I don't think there is any rule that allows you to add any templates to any animal companions. Maybe there is some sort of feat or special class feature that does so, but you certainly can't just choose to make an animal companion into a half dragon without something causing it.
Just because hero lab allows something doesn't mean the rules normally allow it.
| STraveler |
At the bottom of the Druid entry, it will discuss exactly what Druid animal companions get. Nowhere is a template listed. You don't get templates just for leveling up, nor does the animal companion get class levels, even if Hero Lab allows it.
Further, from the official prd Half-Dragon entry:
Half-dragons are only rarely the result of dragons mating with other creatures—most are the result of strange magical experiments. In most cases, a successful creation breeds true with others of its kind, as with the dreaded dracolisk.
Creating a Half-Dragon“Half-dragon” is an inherited or acquired template that can be added to any living, corporeal creature (referred to hereafter as the base creature). A half-dragon retains all the base creature's statistics and special abilities except as noted here.
Technically, yes, it can be applied to anything. But it is either inherited from birth, or it was in some way placed upon the creature. Unless your Druid was given some crazy weird power by nature or did some ritual without you knowing, I cannot think of any way he gave that template.
Further, your the GM. If you say no, it's no.
EDIT: Fixed a spelling error. Because I'm nit picky.