You might want to check out Juha's Book on JMX from Sams publication, it has what you need in detail.
Everything you can do with Model MBeans you can also do with Dynamic MBeans, as Model MBeans are just an extension of Dynamic.
However, a plain Dynamic MBean itself doesn't do much, so you may end up implementing alot of features repeatedly.
Model MBeans provide a "template" of a sorts that can implement a host of generic functionality, such as logging, attribute caching, method mapping, attribute persistence, and so on. Also, the Model MBeans separate the managed resource object from the MBean implementation, and your object may be completely unaware that it is being "managed". Another very powerful feature of Model MBeans is the ability to set descriptors for each element in the management interface, describing the behaviour of attributes, operations, notifications, and so on. These are used to control the behaviors I listed above (logging, persistence, etc) but can also be used for any application specific features. For example, in JBossMX it is possible to intercept the invocations to the managed resource and control the management behaviour based on these descriptor values.