Yes DT buy the image from you for that price and they get all the royalties from the image after that.  They will only buy it if they think that the image is able to make that much money which probably means that it isn't a very good deal for you unless you want some quick cash.  It's  very easy to earn 25$ on an image when it's already at level 4. ( I might be wrong but I think that has gone up to level 5 now)

The photos I submitted were rejected. I'll try a few more.
One of the rejection reasons was that a photo I submitted was a close-up, not a macro (which was a macro shot of tiny 1/8" henbit flowers). Yet when I look at the approved submissions, about half of those are close-ups and not macros. Who knows? It would be nice if they were consistent with the definition of their assignment.

It's pretty much the same principal as their RAW image and subscription policy - they benefit whilst the contributors get ripped off!

Is entering the Dreamstime assignments good for portfolio exposure?

really?
when you think of it, if your image is good enough to win 25 bucks,
i would keep it to myself as RF to earn with DT and other sites
and still own the image.
don't you think?

Your answer is mostly correct.  If you enter that photo into a DT assignment though, it is as an exclusive image.  So you can only earn from it on DT.

I only entered one contest and I pushed the 25 bucks button.  They refused the photo.  I sent it elsewhere, and a few months later sent a cleaner version to DT again.  It's definitely made more than 25 bucks.

I think the quick 25 bucks is pretty great, but they are very specific about exclusivity, and you can't sell other photos from the same session anywhere else because of their exclusivity rules.