On blocks of Dead Grass mainly Pigsies will spawn during the day, and Night Pigsies or occasionally Night Hoglets in some biomes. Also Leafies during the day and at night Night Leafies or even Night Twiggys might show up.
Even though Tundra Flowers are often generated on Dead Grass, they will not grow by themselves on artificial biomes made from these blocks. However Tundra Flowers might regrow in natural Tundras in areas where all originally present Tundra Flowers have been plucked. Red Mushrooms can rarely also regrow on Dead Grass if close to green Grass and in areas that have been "freed" of all Red Mushrooms that grew there before.
Currently no crafting-recipe that would make use of Dead Grass is known. Similar to regular green Grass and Savannah Grass, Dead Grass does not require any Power Cells to be equipped to harvest it.