To be honest I don't think there's ever been a truly great WW1 aviation film and only a handful of good ones - although having said that there's a lot I've never seen and I've not seen any non-English language WW1 air war films. I'd personally give top marks to Dawn Patrol (the 1938 EF/DN version mentioned above) - although it's not perfect by any means it's still one of my favourite films. The Blue Max is quite good as well. Just for fun I also enjoy the 'Zeppelin!' film with Michael York.
There's a good list of aviation films here: http://www.aerofiles.com/film.html
Just a shame they aren't all available on DVD...