He puts your Djinn on RECOVERY. Not Standby. Standby means you can use them for Summons. Recovery does not.
Dullahan actually has an attack pattern that he will always follow - he does not deviate from it. The pattern always cycles, and if you seal his Psynergy (using Luff or Rime - other methods are impossible), he just skips those steps, like other Superbosses elect not to use Psynergy. (If you immobilize him using Petra or Ground, he doesn't skip that step, but just does it on his next action - so it's possible for you to rig it so that Charon or Djinn Storm is his final action. Usually, however, it is his second.)
On Hard Mode, I summon rushed him as early as level 40. In the Arena, I did it once when I was in the 80s (but in Arena he's a lot stronger), but it was definitely hard.
His attack pattern? Here it is:
Attack
Formina Sage
Break
Attack
True Collide
Element Swap
Haunt
Curse
Charon
Bind
Attack
True Collide
Formina Sage
Attack
Element Swap
Attack
Condemn
Charon
Curse
Djinn Storm
Haunt
Formina Sage
True Collide
Note that Charon appears twice in the pattern, and Djinn Storm only appears once. Yet both times for Charon, he uses it 3 actions after Element Swap, and Djinn Storm comes along 2 actions after one of the Charons.
Another note: He starts at a RANDOM place in the pattern, not at the top. I have had him Turn-2 Djinn Storm me. As a result, always ALWAYS save right before Dullahan, as one swing of bad luck will ruin the entire battle for you, regardless of your careful setup.
With this in mind: Get the healing classes. Protector, Pure Mage, Paladin...on as many as you can get. Necromage is also recommended due to Revive - you will need Revive more than you will need Pure Wish, however, since his attacks will most likely cause Insta-Death. Revive people immediately, unless you know Djinn Storm is coming - downed characters aren't affected by it, so if your party gets Djinn Storm'd, then you revive someone, he'll be at full strength if he was downed by the Charon right before (which is a blessing in disguise). For this reason you'll probably want to hoard up a lot of Waters of Life (which you can find a lot from Time Islet Cave monster drops), and distribute them among your party.
If you know he's close to using Djinn Storm (or you think he is - if you're not sure, assume he is, take no chances), get your heavy healers into the back row before he pulls it off, so they won't be affected. If they are, you'll be severely hampered.
All in all, Dullahan is downed always with a good solid repetitive strategy. Just keep it up, anticipate his next move, and act accordingly. His actions aren't random, but sequenced, which is another boon in this hellish battle. If you haven't beaten him yet, good luck. If you have, congrats!