I DM a player who has a halfling paladin riding a war dog. Most of the combat, so far, has been outside, where there's plenty of room for his Ride-by Attack. The PC contributes substantially to the party's successes.
And yet, the PC doesn't dominate. So far, at least.
I'm not sure how "useful" the set-up will be in dungeons.
BTW, we changed the Ride-by Attack feat, to allow the character to "ride-by". Dumb feat, otherwise.