Not sure if you ever took Merrak up on his advice and asked on Discord or not. Posting here in case you're still having trouble with this, and for anybody else who finds this post.
The "The Android SDK is required" message actually shows if any of the Android SDK, Android NDK, or the JDK is missing. If you went through the Android Tools download dialog within Stencyl, you probably have the Android SDK and Android NDK, but not the Java JDK.
I'd recommend you download the latest private release of Stencyl for a few reasons:
1) Ability to target more recent Android versions, which you'll need if you want to publish to the Play Store.
2) Updates to the built-in purchases and Admob support (if you use them). This functionality won't work without the updates in the latest private releases.
3) Important bug fixes, such as prevention of a black screen on startup for users of more recent Android versions.
4) The version of the JDK used to run Stencyl is now packaged with everything it needs to build Android games. So if you don't specify an external JDK, that one will be used by default. This likely would have got you past the error dialog in this case.
As a subscriber, you have access to the private builds which you can find here:
https://community.stencyl.com/index.php/topic,13789.0.htmlAs a subscriber, you additionally have access to the
Help Desk section of the forum, as well as the
#subscribers channel on our Discord, which both tend to receive quicker replies.