How old? I forget exactly when, but some older versions of Armory had some database issues/instability that could cause ArmoryDB to choke. I'm not sure if it presented as a "Failed to spawn ArmoryDB" error.
You mentioned you tried to rebuild & rescan while on the older version, but have you sucessfully cleared the database while using Armory 0.96.5?
Close Armory. Wipe the ~/.armory/databases folder. Then start Armory again. See if it lets you create a wallet this time?

ArmoryDB could also be choking due to being compiled with ASM code that your CPU doesn't support? You could try compiling Armory yourself in case this is a problem?