The SD card was in use in advance, and I just created a new folder on the root.

You need to place the file directly in the "Nikon" folder in the root directory of the card, not in a new sub-folder created within the Nikon folder. Your camera will only "see" it as a valid A-GPS file if it is located in the Nikon folder located in the root directory itself. The camera will not see any file inside any sub-folder contained within the Nikon folder as an A-GPS file.

Should I have done it on a fresh formatted SD card instead?

That depends. If the card had already been "in use" in the camera and had already been previously formatted by the camera it should not be an issue.

On the other hand, if the folder structure of the card was created by some device other than the camera in a way that does not comply with the folder structure required by the camera, then that very well may be where your issue lies. Either save all of the data on the card somewhere else, format the card using the camera, and then copy the A-GPS file to the 'Nikon' folder on the card or use a different card with no data you need to preserve and format it in the camera before copying the A-GPS file to the 'Nikon' folder that should already be on the card as a result of formatting it in the camera.

It seems that the downloaded file doesn't register as a .ee file but a text file.

The file should have an .ee extension. If the device/computer on which you are downloading the file is changing the extension, you need to insure that the extension is .ee on the SD card. Some devices might change the extension of downloaded file types to a text file if it does not recognize the extension. This is supposedly a security measure.

Please also note that the A-GPS update file should be less than 28 days old. For best results, download the current update immediately prior to installing it in your camera.