Well, if DropBox prompts you to create new account, I imagine, you're most likely not logged in.
If you reject the prompt, you're still not logged in and Joplin proceed thinking you didn't setup a sync target (runs locally).
Watch out for the "Log In" button at the dropbox user creation prompt, try using it to log in
Also would it make a difference if you try signing in Dropbox using your default browser on Android and then try setting up the sync target in Joplin again?