When allergy eye drops dilated pupils, does it damage the eye?

No unless: No unless you suffer from closed angle glaucoma.

Usually no but..: You can cause a glaucoma attack if you have narrow angles. These type of drops are not really allergy drops they are vasoconstrictors, they make the eye look better because they shrink the blood vessels making the eye look less red. The best treatment is to remove exposure to the allergen barring that, antihistamine, steroid or other immunomodulating eye drops.