"where the site being logged into essentially creates an account for the user without requiring them have another set of credentials"
SSO that works like that would be fine on centralised sites that have no interoperability with the source of the SSO account.
But SSO like that isn't suited to an interoperable decentralised platform on thousands of servers... it's going to confuse people as they will end up with lots of unconnected but interoperable accounts.