I haven't used WebDwarf, but I've been asked to make changes to a site someone created with one of Virtual Mechanics' other products, SiteSpinner Pro and have been pretty horrified.
The HTML it spits out is basically a bunch of absolutely-positioned divs, apparently in whatever order things were edited in. That means that a box, a headline within that box and text following that headline are all in completely separate locations within the file. Completely unmaintainable unless you also have their software for further edits.