Not many units in Warhammer are so well named as dire wolves, as they are indeed quite awful. The are no longer fast cavalry, they are now warbeasts. Also, as undead, they cannot flee. They are fast, but once they are out of range of the nearest vampire, they cannot march, though you can put a vampire in the unit. So, pretty bad. They also don't contribute to your core allowance.
But now that we are a little ways into 8th edition, I'm thinking of letting the wolves out of the cabinet. Here's the stats:
M WS BS S T W I A LD
9 3 0 3 3 1 3 1 3
As you can see, they are quite poor, low strength, toughness, meh initiative and paltry leadership. Incredible movement though. The special rules are they are undead, and as warbeasts, they get swiftstride.
I used to use them quite a bit in previous editions, mainly as a distraction unit, and as war machine hunters when the opportunity presented itself. Now, in 8th ed, a fast flanking unit that can take out war machines is getting more and more appealing. They fall into the same category as fell bats and bats, but fell bats eat into your special allowance, which I need for more lethal units like grave guard, and they are a little stronger and tougher than bats. 80 points gets you 10 wolves, so not too bad, either 2 units of five, fragile but adds to deployment and gives your enemy two targets, or a more durable unit of ten. You can raise them, and increase their numbers with the vampire power Summon Creatures of the Night.
Banners & Buffs
These boys are affected by all the usual buffs, but as they operate ahead of the lines, and there are more important units to buff, I wouldn't plan on getting many augments on these lads.
Vargulfs make good team mates for dire wolves. Both are fast, the vargulf has the vampire rule, allowing the wolves to march. This gives your opponent pause when targeting the vargulf. 'Maybe the wolves might be easier to kill? Oooh, charge of 18"? Hmm, I better kill them first.' Anything that takes the heat off the vargulf is good news. I wouldn't tend to attack infantry blocks, even in the flank or rear, with wolves. They will only get murdered, and give more combat resolution to the enemy unit. Think easy prey, vulnerable archers (watch out for stand and shoot) and war machines.
With so many undead units being ponderous, or fast but expensive, a fast, cheap, irritating unit worrying at the enemy flanks is all good. But they are supermegazord fragile. I plan on running a unit of ten with two vargulf as a flanking force. We'll see how that goes.