Various potions, items, and perks provide a flat reduction to incoming damage of a particular elemental type. For example, a Shield of Waning Frost reduces frost damage suffered by 30%. Fire and frost resistance items are extremely useful against dragons and their breath attacks. Bonuses from different sources stack additively, so the aforementioned shield plus a potion that increases frost resistance by 20% would reduce all frost damage suffered by half for the duration of the potion.

The somewhat rarer magic resistance enhancement again provides a flat reduction of incoming damage and is effective against all three elemental types. Dragons' breath attacks DO count as magical (at least for this purpose) making such items extremely powerful.

Magic resistance and Elemental resistance stack multiplicatively with each other (i.e. 50% resistance to frost and 50% magic resistance would reduce damage suffered by a dragon's frost breath by 75%).  Each elemental resist along with magic resistance is capped at 85%.  This means with all resistances capped, incoming elemental damage can be reduced by about 98%, but never negated entirely.