Yes it is more or less appropriate challenge, though it should be something like "boss"/"mini-boss".
As TheDarkWanderer pointed out Challenge Rating and average party level shouldn't necessarily match, so your party should probably be ok with a creature like that. After all CR system doesn't describe challenge really accurately, as it depends on multitude of different things like pre-scouting and builds.
You may still want to adjust this dragon for it to suit your needs more, but here is estimated 3.5e statblock based on information you've given:
Size/Type: Gargantuan Dragon (Fire)
Hit Dice: 22d12 +132 (275 hp) x3
Initiative: +0
Speed: 40 ft. (8 squares), fly 100 (clumsy)
Armor Class: 40 (-4 size, +44 natural [decreses slightly in later forms]), touch 6, flat-footed 40
Base Attack/Grapple: +22/+45
Attack: Byte +29 melee (4d6+11)
Full Attack: Byte +29 melee (4d6+11) and 2 claws +27 melee (2d8+5) and 2 wings +27 melee (2d6+5) and tail slap +27 melee (2d8+16)
Space/Reach: 20 ft./15 ft. (20 ft. with byte and tail)
Special Attacks: Crush, Tail Sweep, Lava Bomb, Earthquake Stomp, Shed Embers, Lava Vomit
Special Qualities: Darkvision 60 ft., Low-light vision, Dragon traits, Vulnerability to Cold, Immunity to Fire, DR 10/magic, SR 26, Paragon Fortitude, Paragon Fury, Blazing Form, Hardening Skin
Saves: Fort +19, Ref +13, Will +16
Abilities: Str 32, Dex 10, Con 22, Int 15, Wis 16, Cha 18
Skills: whatever
Feats: Multiattack, Power Attack, Improved Bull Rush, Awesome Blow (and 4 more feats of DM’s choice)
Challenge Rating: ~18
Crush (Ex) (4d6+16) DC 32;
Tail Sweep (Ex) (2d6+16) DC 32
Read
this about dragon specials. Note, while it is generally suggested to base these attacks on Con, I personally suggest to base them (as well as Earthquake Stomp) on Str instead, as they are basically area melee attacks.
Earthquake Stomp (Ex) (~2d6+16) DC 32
It is hard to convert this into 3.5 safely, since 3.5 is much less cartoon-styled, so just stomp would hardly be capable of causing Sonic (or what alternative is appropriate for Thunder?) damage. You may want to completely rework it.
Blazing Form (Ex) (~ 3d6)
Lava Bomb (Su) (~ 7d10) DC 27; Shed Embers (Su) (~ 9d10) DC 27; Lava Vomit (Su) (~ 12d10) DC 27
These are based on appropriate Breath Weapons of similar dragons.
I’ve added Fire subtype here, making Vulnerability to Cold and Immunity to Fire constant. You may of course reverse this, but it is how 3.5 generally deals with such cases, I believe.
Damage and Reach are now set as appropriate for gargantuan dragons. I added longer reach for the tail as it seems to have longest reach in the source. Gargantuan dragons usually also have Wing attacks (as well as Crush and Tail Sweep specs). Feel free to remove them if needed.
Bear in mind that this creature will became MUCH stronger when it will lose two of it’s pools. So it isn’t CR 18 from the start, but maybe somewhere close at it’s third pool.
It's hard to say
In the DMG on page 280-281, there is a table of many common features of monsters, and how these features could alter the Challenge Rating (CR).
Specifically, on page 281 it states:
Name : Pack Tactics
Effect on Challenge Rating: Increase the monster's effective attack bonus by 1.
This monster currently has a defensive CR of 1 (see DMG p. 274 for rules on calculating this) and an offensive CR which is difficult to calculate since no save DC is given for its most dangerous ability. However, since this ability is only based on a Wisdom Save, we can safely focus instead on whether an attack bonus 1 higher than its current +7 would result in an offensive CR of 6 or higher (since 5 or lower would result in an average CR of at most (1+5)/2 = 3, it's current CR).
If this creature's attack bonus had been +8, this would only be relevant if it used its "bite" action to damage. Since the bite does 17 damage per round, its offensive CR would only be 4 (See instructions in DMG p. 274). Thus, its CR would likely not increase due to Pack Tactics. However, this conclusion is complicated by the way the monster's stat block is currently written.
The monster's stat block makes this unclear
The monster's current stack block appears unfinished. There is one ability written as:
Action Name. Enter the description for your action.
And a previously mentioned (powerful) area of effect ability that calls for a Wisdom Save, but doesn't give a DC. This makes it somewhat difficult to know what calculations the designer used to determine the creature's current CR.
Critically, the unnamed action appears in the stat block at the very start of the Actions section. This indicates to me that the creature's creator may have intended to give this monster multiattack, as that is where multiattack is usually listed in the stat block of creatures that have it.
This is a serious problem, because if this creature can bite twice in a turn, then its current offensive CR would be 5 (which would fit with its current CR of 3), and a further +1 bonus to its attack would then pump its offensive CR to 6, which could increase its overall CR to 4 (DMG p. 275 indicates you round up the average of Offensive and Defensive CR).
This is further complicated by the fact that this creature's most powerful action is an area of effect power that, as written, could also damage nearby allies. Since Pack Tactics only works when allies are nearby, that means the Beowulf's Pack Tactics will present a tradeoff, gaining advantage while losing (or complicating) access to its best ability.
So which is it? Higher, or the same?
Until this creature's stat block is completed, it will be impossible to accurately calculate its CR, either with or without new features. But if the creature has multiattack and can bite at least twice, then Pack Tactics would raise it from a CR 3 to a CR 4.
Best Answer
This should be an enormous increase in CR.
Basically, you're giving every attack the zombie makes a "save twice or die" effect. Unless there's some easy way to cure this infection outside of combat, your entire party will be dead within a week.
There's a reason Left 4 Dead and some other zombie games/media often imply or outright state that the main characters are, for whatever reason, immune to (or asymptomatic carriers of) the zombie disease: not being immune makes survival mostly a matter of being very, very lucky.
Let's say a character gets attacked by 4 zombies. Each zombie has only a 25% chance of hitting the character, and the character has only a 25% chance of failing their save. Further, let's say that each time all the surviving zombies have attacked, the character kills one (so the character is attacked 10 times: 4+3+2+1). If they only have to save once to be safe, the character only has a 52% chance of not being infected at the end of the fight; if they have to save twice, it's a 31% chance. And that's a single fight.