The "Add association" is usable only if you have defined a topic map schema in your topic map. Schemaless association dialog is for adding associations when you don't yet have a schema in the topic map. However note that the schemaless association dialog will also use the schema to make editing a bit easier, but of course only if there actually is a schema in the topic map.
Creating the necessary role and association type topics, as you have done, is the first step. After that you need to create a few associations. First you have to associate the roles with the association type. This means that you define what roles are possible in this association. After that you must associate the association type with the content type. In this case written_by with book and person.
More specifically, go to the "written_by" topic and add a new association there. Since you have added "written_by" as an instance of "Association type" you can use the normal "Add association" editor for this. Select "Role" as the association type. The role of "written_by" topic should be "Association type", the dialog should have selected this automatically. The other role is "Role". Write "person" in the text field and click OK. Then do the same again but this time write "book" in the text field. Now you should have two associations in "written_by" topic that say that roles for "written_by" associations are "book" and "person".
Next go to your "book" topic. If "Content type" isn't in the class list yet, add it. Then add a new association in "book". The association type should be "Association type" and role of the "book" topic should be "Content type". Wandora has probably selected these automatically but if it hasn't you should find them in the drop down boxes. In the text field type "written_by". This association means that "written_by" is a relevant association type for all books. You also probably want to do the same for the topic "person". Otherwise you can't associate books to persons when you're editing a person, only the other way round.
After this you can go to any book topic and use "Add association". Wandora should offer you a "written_by" association. You can type the name of the book in the text field. You can use tab key to complete the topic name after you have typed a few letters.
Note that base names in all dialogs are case sensitive so take care to get them right. There is also a detailed guide with screen shots here
http://www.wandora.org/wandora/wiki/ind ... tle=Schema
I hope this helps.