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Depends on what you want. Why not get both army books and have a read through, look at hiw each army plays and ask yourself if that's how you want to play. If this doesn't help make a 500pt army of each and play a few games to get the feel of the army. Then make you mind up, alterativly you could just do both .
Lizardmen are probably the best spell casters in the game (but very expensive), they are also a tough army. They can be very tough to beat when handled properly. They have some pretty good magic items, and you can add a certain colour to a unit and it'll have special rules. Also if you like fast monsters that can tear the Sh!t out of things in combat, you'll love the Carnasaur. But if you want a magic heavy army them go for Lizardmen.
Dwarfs, now Dwarfs are tough, very tough. These bearded fellows will refuse to flee unless they have no other choice. They have tough units and allow you to make your own magic items (which is so cool to do), they are quite techincal and have the best war machines in the game. They also are very anti-magic, and you can completely tool them up to fit this. But on the down side they are slow, very slow (due to short legs) but if you want an army that can take an charge and strike back hard then I'd go for Dwarfs.
Hope I've helped if I can, just ask.
hehe it's King Ulkrik to the rescue as always!
basically i agree with whatever he says although I don't know much about lizardmen. however i must add that if you don't like to be defensive then dwarfs are not for you cuz' from what I hear they are the most defensive army in game. Just satnd back and shoot to thin down the enemy then when strike back when they charge you.
Hey I help where I can, If you need help I will appear :lol:
But Dwarfs are not just a defensive army, and it suprises your opponent if you go on the attack. But it's hard and you have to keep a solid battleline or your dead. Shooting the enemy before charging is a tactic all races (with missile units) use.