Everytime a dragon dies you absorb it's soul unless you're too far away. You probably have 10 seconds or so to get close enough once the dragon goes into the death animation. The other time you will not absorb the soul of a dragon even if your close enough is when you no longer need to. This surprised me and I thought the game was glitched. I had taken down 2 dragons and realized I was close enough to absorb the souls, but it never happened. The reason I realized is that I no longer needed to. I had recently discoverd all 20 shouts and the number of souls I collected previous to discovering the 20th shout exceeded the number of total words I needed to learn to fully speak each shout. I have 18 unused dragon souls and need only 14 words to completely unlock and fully use each dragon shout. This means I no longer need to collect the souls of each dragon I kill or help kill. For all you capitalists thought you can still collect whatever loot is on the dragon and make some money.