Things like saber-tooth tigers and wooly mammoths seem to fit into fantasy settings so well because humans have actually lived alongside these animals in the distant past. To have a world where humans and Ice-Age critters compete for survival hearkens back to more primitive, chaotic times. This lends support to a less sophisticated medieval world, where the animals that eat people still haven't been killed off.

Dinosaurs and humans, regardless of what Ken Ham may have told you, have never coexisted. Unless you have some kind of Dinotopia setting where the dinosaurs have been explained to have never gone extinct, to simply have dinosaurs roaming about a fantasy countryside is jarring. Dinosaurs can live in a medieval world, but they are better suited to jungles, deserts, and other hostile places to civilized life where humans cannot easily survive.