Sourcing lecture notes instead of publications I am writing an undergraduate dissertation and I have found some very good information from lecture handouts from other universities. 
Will using these lecture notes compared to official publications or other dissertations reflect my dissertation in a bad light? 
Of course I will source everything.
I firmly believe that one should cite what one has used... and possibly more. To use a source and not cite it is simply dishonest and fails to give credit where it is due. At the same time, yes, one also wants official credibility, which usually entails citing refereed-journal publications (although the latter is not a promise of correctness, either). If nothing else, citing refereed-journal publications is expected, so doing it is doing what one is expected to do.

(Lecture notes are not always mere echoing of textbooks or journal articles.)

So, cite both the actual source you used, and find "cite-able" sources to accompany, so you'll be both honest (and explanatory) and "formally correct".