Confused by GRANT ALL PRIVILEGES causing Access Denied for database 'mysql'
You only have SELECT privilege on mysql.user and mysql.db.
You need to have more than that. If you could be granted
GRANT UPDATE,INSERT,DELETE on mysql.user TO 'dbadmin'@'10.%';
GRANT UPDATE,INSERT,DELETE on mysql.db TO 'dbadmin'@'10.%';

This will allow you to CREATE USER as it must be able to write to those two tables.
With you current grants on mysql.user and mysql.db, you cannot create any user.