The type of dinghy is relevant.
I have a nine-foot inflatable. When sailing for more than 5 hours, it is deflated, folded up, and either sits (under a cover) strapped on deck or stowed in the cabin. If moving short distances in nice weather, it is towed from anchorage to anchorage. If going into a Marina, I'll hoist the dinghy on the foredeck, flip it over and secure it. If it will be on the foredeck for more than a couple of hours, I'll throw a tarp over it. The dinghy is 15 years old and still in good shape.
If you have a fiberglass or wood dinghy, it is more often found on boats' foredecks or dangling in davits off the stern when not being towed.
I suspect that covers are used less on non-inflatables as they are better at resisting UV damage.