Hi Susan - I can thoroughly recommend visiting Dharmsala but you will need to allow more driving time if you'd like to go - if you cross the border from Lahore in the morning - it opens around 9-10 - you will need to allow the rest of the day to get that far north. Road travel can be pretty slow on the way up and including time taken to cross the border and get on the road, you should plan to arrive at night. You'll also need to organise transport on the Indian side unless you've got a car with the right paperwork to travel across the border to India.
One alternative might be visiting Amritsar if you'd rather cut down on road travel - it's about an hour from the Wagah border crossing, v easy to organise transport there when you cross the border. Otherwise, depending on flights, you could visit Gilgit or Chitral in northern Pak, but flights go from Islamabad, so do factor that in - it's a four-hour drive between Isloo and Lahore. Bear in mind it'll be a bit cold at that time - and flights are weather-dependent, but it's worth the journey to visit both places. There's also the drive to Gilgit to consider if you can't fly - you could drive up the Karakorum Highway to Gilgit - it's another long drive - roughly 18 hours - but it's a good way to see the north of the country.