The drawbacks of body seizing are indeed significant. Because forcibly occupying someone else's body makes it very difficult to achieve one hundred percent soul compatibility, not only does cultivation remain limited, but life is restricted to this one lifetime without the possibility of reincarnation. That's why even powerful individuals generally avoid it, but in special situations, it may still be done—for example, when at a dead end.
As for why Dan Xianzi collaborated with Mo Liancheng, there are reasons.
Because, although he borrowed the tiny Dream Beast to escape from the City Lord Mansion, he couldn't get very far. Even as a Profound God, there were still significant limitations. Moreover, the timid and cowardly nature of the small Dream Beast didn't give him much sense of security; it was highly possible that, at a critical moment, it would abandon him and flee.
Additionally, body seizing cannot be done just anytime.
It requires finding a suitable person...
