If God doesn't make mistakes, why did he create the dinosaurs? And why did he kill them all off??
Silly answer: Because he didn't want them eating us and we needed all those oil reserves.
More serious answer: I think there could be several possibilities and some of it depends on how you view some other stuff in history and whose chronological scales you use. Are we thinking this had to happen within the 6000 or so year window the creationists would give us? Are we thinking that the dinosaurs existed and then went extinct before human beings were on the scene? How do we explain and interpret what animals are being described in Job when it talks about the Behemoth and the Leviathan?
Since there's too many questions on dinosaurs let's go to something more concrete and also more difficult. Genesis 6:6 - Talks about God repenting, being sorry, regretting making mankind and it greived him. And then he wipes out the entire human race save a handful of people. So the same God who cannot make mistakes can regret something he has done. That gets even more mindboggling if we affirm that God is omniscient and so knew exactly what mankind was going to do and that things were going to happen this way from the start.
The only answers I can come up with when it's past my bedtime are that the dinosaur question pales in comparison to the flood story. If you accept the creationist account then it's pretty reasonable to think that God knew that dinosaurs could not survive in the post flood world and so didn't have Noah include them on the arc. They were then an extinction more caused by man that the design of God. If you take a longer term view then let's conform to the scientific consensus that the dinosaurs were around for millions of year, even most of the scientists think humans are within their first 50,000 or so (I don't really know the numbers, but I'm sure you can dig through the internet if you're wanting to look the specifics up, I am sure it's quite a bit less time that the dinos). Did God make all of the dinosaur species to last forever or did they exist only for a season?
So I don't have a lot of explanations or answers for you, but I think if I'm going to worry about God wiping things out and if that means he made mistakes, the story of Noah and the flood gives me plenty to wrestle with and some more solid theological evidence to do so.