Check root's PATH which should not reference sqllib/bin (or other folders under sqllib). If these references are present, remove them from root's PATH and resubmit the db2icrt command. DB2 does not support root as an instance owner.
This is what I found at the IBM website when I had the same problem
Make sure that the ID is valid, login in as the id first, don't su to it, Make sure the password is valid,