There is no point in puting conformal fuel tanks. Engine does not produce enough power. Yeah you can free up potentially three stations for weapons, but with that much load it will become a pig in other words an easy target. And besides i don't think it would be able to use all of it's weapons stations anyway as it would exceed MTOW with full CFTs.
Plus more powerful engine means it needs more fuel to achieve the same range, so really CFT would just make it more heavy and less maneuverable.
When it comes to CFTs PAF has experience of using them with F-6 and F-16 atleast if my memory serves me right..
The main things needed for CFTs are:
1. They do not add any penalties negative for a dog fight, such as speed/G restrictions as they cannot be jettisoned.
2. Do not add much drag, as in a dog fight you jettison drop tanks and other payload except short wvrams, mostly two on wingtips, to achieve almost clean state and least skin/volume drag for that fighter. F-16's CFT add about 2-3 % such drag which is insignificant. I think same was the case with F-6 we used.
3. Over the fuselage CFTs also look to need to be less heavier, below the fuselage CFTs I think require to be heavier like drop tanks, this means less lift required and therefore less drag because of lift.
I disagree with your opinion, normal drop tanks add many restrictions, occupy stations and complicate mission planning as you have to account for jettisoning them in unusual scenarios. Also they add lot of drag and their fuel efficiency is about 40 % below internal fuel. Using CFTs can enhance range handsomely while effecting fighter characteristics the least.
F-16 is not even in the same class as JF-17.
F-16 : 19,700 pounds without fuel with +29000 lbs of thrust
Jf17 : 14,520 lb without fuel with +19000 lbs of thrust.
F-16's engines create ~50% more thrust while the aircraft is only ~25% heavier than JF17!!
You do the math.
In a dog fight, both will be certainly above 1 T/W ratio, that is what is important.. Even at full fuel, both will be at or above 1 ratio.
The F-16 engine and its thrust you mentioned came much later, with original engine and its thrust (equivalent to what JF-17 now has) C/Ds with about 2000-2500 kgs of more weight than A/Bs would be duds.
Size, weight, volume is not good for drag because of both skin/volume and lift drag. Both fighter designs are excellent in this regard.