Traffic was not bad at all, we were there about 11:00 on Sunday morning. Its a fun drive and I recommend it if you live close or are going to Gatlinburg. The GT did great on it, was really surprised at how good it handled. We only saw one cop the whole time so that made it good too.
I've done the dragon six or eight times on a couple different trips, all on motorcycles. It's a truly fantastic road, but there are similar roads in the area that are as good (or nearly so) that have nowhere near the traffic and festival atmosphere. If you like people and festivals, you'll like the Dragon, but for me, it is way too overused and overrun with drivers who are either in over their head or so intimidated, they can't get out of their own way. At high-volume times, you'll get caught behind very slow-moving trains of bikes and cars (e.g., club drives, bunches of people driving together, etc.) that are impossible to pass safely, even if you're in a very fast car/bike. I've never had a clear run for more than a handful of corners. If you're a decent curvy-road driver, it takes some aggressive double-yellow passing (and more power than an Elantra GT has) to not get caught behind slower traffic for most of the run.
If you can "catch it" at a slack time (e.g., shoulder season non-weekend, early morning, etc.), it can be a lot of fun, but there is a lot of moisture and fog in the area so it often doesn't dry out until very late in the day (if at all). And five months of the year, ice and snow are real possibilities. It's definitely a great road that suffers from its destination status.
My suggestion is to take it in, but spend most of your time on the surrounding roads.
I readily admit that I have a somewhat jaded view on this - within a few hour drive, I have access to roads that are nearly as curvy and where you can drive for an hour or two without seeing another vehicle.