You're confused about two different types of users. The computer has users and the database has users. The "Create user" command you mention, happened in the psql prompt and thus on the database not on the computer.
I'm looking at the github readme ( not sure which one you are using) but the password you want is the one you entered when you did
1) Create a user and path for the DIRTSAND server to run from
(OPTIONAL, but recommended).
$ sudo useradd dirtsand -d /opt/dirtsand -m -p <password> -s /bin/bash
If you did that
What I usually do, is run the dirtsand "keygen new" file as described, and copy them over to the "dirtsand.ini" file with a text editor.Also I enter the password for the database in the file.