Dictatorship is useful if you really want to be sure of the outcome of your election since you simply pick whatever you like to win. If you invade a system and raze or pillage it, dictatorship negates the hit on your approval. In my experience it's helping empires that have little influence, but big fleets.

There are few other beneficial perks, like Propaganda improvement that applies bonuses on system (based on the ruling party)

https://endless-space-2.fandom.com/wiki/Senate#Dictatorship

Typically other government types are superior, but it has some great Power law effects if you care about them (reference the chart at the bottom of Sublustris's link) and it removes approval penalties to Raiding and Razing systems. Those are its two greatest strengths. Probably best suited for an aggressive win condition (Conquest/Supremacy). Being able to switch your party affiliation to whatever you want at election time has some interesting possibilities, although fringe.

Like playing pacifist Cravers and forcing peace with everyone

Please correct me if I'm wrong, but one of the drawbacks adopting dictatorship is you need to evolve each political party, one by one although propaganda gives buffs. Also, it seems the populations are going to be unhappy easier because their political party isn't represented in senate. Pacifist Cravers would be nice, since the last friendship act they had with me was demanding 10k dust to not raid my systems.

It seems the populations are going to be unhappy easier because their political party isn't represented in senate. picker wheel spin wheel

Dictatorship is best used as a transitional government type. It lets you pick a political party that your population won't naturally support and artificially boost its support and experience, then switch to a different government type once you have the laws you want unlocked. For example, Hissho can switch to a scientist government earlygame for more science from the dictatorship power law and Star Boogie Bill to move their mining behemoths faster, then transition to a Militarist/Scientist Federation in the lategame for double combat power boost laws and increased colonization cap from Heroes so they can hold enemy home systems without crippling their economy.