First of all, thank you for creating Dropbear SSH. I would love to try it. I am currently using OpenSSH with PAM (Google Authenticator) and Ed25519. Does Dropbear support both PAM and Ed25519?
PAM support is fairly rudimentary and only supports username/password. ed25519 isn't supported - a few people have wanted it I might add it at some point. I haven't seen a real reason to go with that over ecdsa.
The reason to use Ed25519 over ECDSA is that ECDSA can't be used unless you have a good CPRNG. Just ask Sony what happens if you reuse a nonce with (EC-)DSA.
True, that could be a good reason.
Forgot to mention and can't edit in the previous comment, there's a PoC ed25519 implementation I need to look at merging.