No, I don't think it can be taken literally. For a couple of reasons:
1) order of magnitude. the Elder Races (Vorlons and Shadows) were immensely powerful and were only finally defeated through words, not deeds. To then have a force capable of a whole order of magnitude more powerful not be able to accomplish thier goals will stretch credibility.
2) I think this is a "teaser" line. Rightly or wrongly, a lot of B5 fans dismiss Season Five and Crusade because they didn't involve the Shadows. In some people's minds, the Drahk don't just measure up. I think that's unfair but a statement like that will perk up those people's ears.
3) Sense the nature of the threat, not necessarily the power of the threat. The Shadows didn't have a grat PR machine, but they weren't out to rule the galaxy and/or destroy all other life (per se). If these aliens are planning on something along those lines, they justify the statement because they actually represent a greater danger, even with comperable pwoer level.
4) Finally, could the character speaking turn out to be wrong? ("I thought you said these guys were invincible?" "Well I thought they were - good job figuring out thier ships are vulnerable to butterscotch pudding.")