It seems rather odd that what others have done successfully, you seem to have so many issues with. Please remember that OverDrive is the site, Libby is simply an application that connects to the site. As for logging into Overdrive, a quick web search for overdrive login gave me a hit on
Overdrive Signin (see attached images).
I'm not certain what you mean by sign into OverDrive with an OverDrive account on the Kobo and then immediately afterward add a library. What I saw was an option to create account or Sign in to OverDrive. When I selected OverDrive, I was asked to Find a Public Library (this will be your main library). I typed in enough of the library name for it to show up in the search results and selected it. After this, I got a page with a QR code, a code to use signed into OverDrive and a button saying Sign in on this device which I used. I signed into OverDrive using my OverDrive ID and password and all seemed to be happy.
Oddly, the same login I used to use with the OverDrive app and website is also the login I use with Libby and does work on my Sage. I have used both just adding the library using my library account number and PIN and selecting the library and then logging into OverDrive. I preferred the library selection since typing in one of my web passwords on a Kobo ereader is a bit of a pain.
Sadly, Google fu is running weak in these latter days...