I checked it against the simulators. At least that way that I used it for testing, the dome starts parking as soon as the mount is parked. Therefore, for me the most plausible explanation is that the mount drivers for 10micron and the CEM70 have a bug that they report the parked mode too early.

I did not enable logging for mount and scheduler at the time. But I can tell that if I start the shutdown procedure in Scheduler then the mount park first and the dome waits for the mount to be parked. Only when I am running Scheduler and there is a weather alert then the mount and the dome park simultaneously. Outside of Schheduler, the dome and mount responses to weather alert correctly (mount park first then dome). It seems Scheduler has a different way reacting to Weather Alert rather than just run the observatory shutdown protocol that is preset in this module.

Is there a dome parking policy configured on the Observatory tab? This could be the explanation, that from there the parking of the dome is triggered.

Here are my configurations related to dome and mount policy
Here are my configurations related to dome and mount policy
  

Ok, we found it. Please deactivate the alarm setting in the observatory tab. This is independent of the mount status and thus triggers directly dome parking. 

You mean the  Alert-> Park Dome under Actions section right?
 

Exactly! As you can see from your screenshot, parking of the dome happens immediately when a weather alert arrives (the delay is set to 0 seconds).

If you want to use the shutdown procedure from the scheduler, better turn this entirely off.

Excellent. Thanks. I'll try it and report back the result. But if I am not running scheduler then Watchdog handles the weather alert nicely (dome park after mount) Somehow if I run Scheduler the watchdog policy is bypassed.

Okay so I tested it. If I uncheck the Alert option in Observatory tab, the scheduler now work as intended (while scheduler is running, the mount park first then the dome).
but if the scheduler is not running, the mount and the dome does not react to weather alert at all (they park on weather alert before, mount first then dome).
this is somewhat better but it'd be great if there is a solution so that the weather alert working all the time.

That's right. We discussed whether the Observatory should also contain a mount control. We decided not to implement the functionality there since it a) comes into conflict with the scheduler and b) an observatory control should not be better kept separate from KStars/EKOS.

Especially the latter argument needs to be considered thoroughly. KStars/EKOS is a very complex application where we never could 100% rely that there is no crash - with the result leaving the observatory unattended. Here comes the watchdog into the game. The watchdog is intended to run separately and take care of the observatory safety.

Since I only have a simple pole for my telescopes, I do not have the personal experience and no clear view, but that's the summary as I remember from former discussions here on the forum.

I am using watchdog and it worked great. But if I disable the alert setting in the observatory tab then the watchdog does not respond to the weather alert. Is that what it is supposed to do?

Just tested Watchdog with weather alert and it didn't work. I debugged and found the issue, please re-compile from INDI and it should work. The watchdog is completely independent from Observatory module as far as I know.