Many Bond fans agree that Dalton is probably the closest portrayal to the character of the original novels. Both movies have flaws, but also have good points. I like Living Daylights a lot more, and it has become, over the years, one of my favorites in the series. It has some great action set pieces (including some stuff that is interesting to see now, like taking the side of the Afghani Mujahideen against the Russians back when we still considered them 'freedom fighters'), great locales, great score by Barry, and a great reveal introduction of Dalton as Bond. Dalton shows a bit of a world-weary side to Bond that comes up occasionally in the books, but was never portrayed by any of the previous Bond actors.
License to Kill, I like a lot less. They tried to go in a slightly darker, more realistic direction, kind of like they would later do with the Daniel Craig movie. That's not the problem. The problem is that they didn't commit to the new direction -- they chickened out midway through the movie and so you have a really unsatisfying (for me) combination of darker with silliness. A lot of it could have been avoided by not having all the Q stuff in the middle of the movie which really undercuts the tone. Aesthetically, the movie suffers from a really limited number of exotic locals as compared to other Bond movies -- it kind of picks a place and stays there. It also suffers from being one of the Bond movies that John Barry wasn't able to score.
On the plus side, Wayne Newton is awesome in his small role, and I occasionally use his "Bless your heart!" line. Yeah, that sounds stupid when you read it, but you'll understand when you see the movie. There's also some important continuity for the series involving the recurring character of Bond's FBI friend, Felix (some of which was taken from one of the novels).
They're both worth watching, although I think Living Daylights is a better movie. Both are directed by John Glen, who came up through the Bond movie ranks, having previously been editor and second unit director on films like 'Majesty's Secret Service' and 'Spy Who Loved Me.' He began directing the series with the mostly excellent 'For Your Eyes Only,' and directed the series all the way through to 'License to Kill.' Some good and some less good in there, but definitely far from the worst.
Er, I hope that answers your question.