Introduced by Munster for the closing 30 minutes, O'Connell was playing for the first time since fracturing his right forearm during the Lions' opening Test against Australia in June.
The second row was closely watched by new Ireland head coach Joe Schmidt and forwards coach John Plumtree from the stands as Munster bounced back from losing in Treviso last weekend.
Prop James Cronin's second try of the season gave Munster a 13-6 advantage at the break, the hosts moving clear after Kris Burton had matched JJ Hanrahan's early brace of penalties.
Yellow cards for Dragons captain Andrew Coombs and Jevon Groves left the Welsh region in all sorts of trouble and Munster skipper Peter O'Mahony's close-range try, supplemented by a further Hanrahan conversion and penalty, made the game safe for the game.
The Dragons, who opened their campaign with two wins from three, were level at 6-6 by the end of the opening quarter in Cork without having achieved much in attack.
Munster's indiscipline saw them lose four players to the sin-bin in Treviso, and they continued to cough up soft penalties.
O'Mahony and his back-row colleague Paddy Butler were the guilty parties as Burton cancelled out Hanrahan's lead scores, the former Ireland Under-20 star having landed penalties after seven and 19 minutes.
Hanrahan missed a tricky third attempt from the left wing and as the Dragons' well-organised defence continued to frustrate Munster, Burton was off target with a snap drop goal effort.
A knock on from a lineout maul, allied to a scrum infringement from John Ryan, prevented Munster from creating pressure in the Dragons' 22, but O'Mahony swooped on Hugh Gustafson's overthrown lineout to set his side up for a telling 35th-minute attack.
Direct running from Ivan Dineen punctured the visitors' defence and with Cathal Sheridan delivering quickly from the base of rucks, Cronin came on the charge to bulldoze through a tackle and make the try-line.
As the rain began to fall, Hanrahan fired over the conversion from the left to establish a seven-point advantage and give Munster something to build on.
Burton clawed back three points early in the second half, slamming over a penalty from just inside the Munster half, but the Dragons lost the services of Coombs shortly afterwards.
The Dragons skipper was sin-binned for a reckless use of the boot on Damien Varley as he attempted to clear a ruck and just a minute later, flanker Groves followed him for collapsing an advancing Munster maul.
The 13 men could not hold out and O'Mahony wormed his way over from a close-in ruck, with confirmation from TMO Jude Quinn, and Hanrahan's successful conversion making it 20-9.
O'Connell came on to huge acclaim from the home crowd, joining fellow stalwart in the second row, as the province tried to push on for a bonus point.
But Dragons replacement Sam Parry won a crucial penalty as his side defended close to their line, and it was the Welshmen who had the better scoring chances in the closing stages.
Munster were forced to defend for much of the remainder, with Dan Evans and Ross Wardle both crowded out in the right corner as the Dragons hunted for their own bonus point.
Their best opportunity was spoiled by a Wardle knock on as replacement Jason Tovey looked set to put him over late on.
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- Kris Burton