By Lily Kuo

NEW YORK (Reuters) - To Ray Marino, $374 seemed a small price to pay to see flying dragons, a cast of wisecracking, back-flipping Vikings and the looks of wonder from his children as they watched a live stage show -- not just a movie.

"You get to kind of feel it, rather than just watch it on screen," Marino said at the intermission of "How to Train Your Dragon Live Spectacular," a massive arena show that played recently in New York and is based on the 2010 film from DreamWorks Animation SKG Inc.

DreamWorks, the studio behind the "Shrek" and "Madagascar" film franchises, is transforming its popular family movies into stage productions, extending their product lives in a strategy used successfully by The Walt Disney Co with its "Disney on Ice" arena show and Broadway shows.

Dreamworks teamed up with theater production group Global Creatures -- whose animatronics arm had already made another arena show based on dinosaurs -- and promoter S2BN Entertainment to create the live show.

The response from Marino -- who with his wife surprised their children, ages 7 and 10, with the front-section seats -- is exactly what DreamWorks hopes to get in cities across North America. The show, which recently played at New York's Nassau Coliseum, is now in Montreal. There are plans to continue to other U.S. cities through 2013, and makers of the show hope to tour next in Europe and Asia.

The show, which made its U.S. debut in June, tells of a Viking teenager named Hiccup and his tribe of dragon slayers. It uses 23 animatronically engineered dragon puppets, some with wingspans of up to 46 feet and weighing over 1.6 tons.

The story, in which Hiccup befriends a dragon and ends generations of war between man and fire-breathing beast, is loosely based on a popular children's book by Cressida Cowell and follows the 2010 DreamWorks movie that made nearly $500 million at worldwide box offices.

Action scenes are created through projected animation surrounded by real smoke and columns of fire. Cable-suspended beasts lift off the stage to achieve what the show's makers say may be its best feature, flying dragons.

"It's almost bigger than Broadway because you can't achieve what we do in ... theater," said Gavin Sainsbury, head of puppetry. "It's the DreamWorks version of turning their amazing film into a live theatrical extravaganza."

FIRE-BREATHING BUSINESS

Makers of the production would not comment on ticket sales but pointed to full arenas, positive blog posts, and solid reviews as evidence of a good reception.

"We're excited by the momentum the show has right now," said Bill Damaschke, DreamWorks' chief creative officer, noting the show was the company's largest stage production yet and was still in the early stages.

In 2011, a live U.S. touring show based on the DreamWorks film "Madagascar" was cut short without a reason given by the company. And past DreamWorks stage productions have not been hits like Disney on Ice, which has played for decades, or Broadway stage musicals like "The Lion King" and "Beauty and the Beast," both based on popular Disney films.

"The Lion King," for instance, ousted "The Phantom of the Opera" this past April from its long reign atop of the list of all-time Broadway box office hits after generating gross ticket sales of just over $853.8 million, Disney said.

DreamWorks' "Shrek, the Musical," which has been playing in London's West End for over a year, posted a second-quarter operating loss of approximately $5 million, according to the company's last earnings call on July 31. That show cost $25 million to create, according to a person near the production.

The live "How to Train Your Dragon Spectacular" cost about$20 million, according to Damaschke.

The show's ultimate success could be helped by a new television series, based on the books and movie, set for this fall on Cartoon Network. A film sequel is planned for 2014.

The challenge in getting people to come to the live shows, said show director Nigel Jamieson, is to get the word out that it isn't just "people running around in foam suits with a few kites pretending to be dragons."

The recent performance in the Nassau Coliseum was nearly full. Glowing Viking horns and sparklers punctuated the darkness as families waited after intermission. Children waved replicas of the dragons.

"It's pretty awesome," said Abby Marino, 7.

(Additional reporting by Ronald Grover; Editing by Bob Tourtellotte, Gary Hill)