Doflamingo said he is back to his old kingdom. Why did he said that and what was the point of choosing Dressrosa as his kingdom?
The Donquixote Family is a royal bloodline which ruled the Dressrosa Kingdom eight hundred years ago and one of the twenty royal families which founded the World Government.
This is reason for him saying that he is back to his own kingdom as his ancestors were the original rulers.
They were replaced by Riku Family when they shifted to Marijois. Here is the wiki article for that:-
Dressrosa was one of the 20 Kingdoms that fought the Great Kingdom. The Donquixote family originally ruled Dressrosa but the family moved to Mariejois and were replaced by the Riku Family.
Doflamingo was a World Noble when he was born but his Father left that position when Doflamingo was young. Here is the wiki article.
Forty-one years ago, the child Donquixote Doflamingo was born in the noble bloodline, and two years after, the second child Rosinante was born. After enjoying eight short years of the Celestial Dragons' privileged lifestyle, Doflamingo was evicted from such luxuries when his father, Donquixote Homing, abdicated their status as World Nobles in order to live a normal life with his family of four; Homing was always considered by his compatriots as blasphemous and disgrace to the title of World Nobles. However, Doflamingo was still clinging onto his heritage by asking his father to buy more slaves and demand subservience from commoners, an attitude that Homing intended to reform.
The family took residence in a country in the North Blue, which has no ties to the World Government. As a last favor, the Government has prepared an adequate manor and financial assets for the family to live with. Although Homing wished for a humble and peaceful life with his family among humanity, away from Mariejois' spoiling nature, little did he knew at the time that the island they resided on was filled with people who bear deep grudges against the Celestial Dragons, which would, in the future, become a stepping stone to Doflamingo's descend to darkness.
Shortly after taking residence in the country, when it became known that the Donquixote Family are former World Nobles, their manor was burned to the ground by angry victims of the Celestial Dragons, and the family was forced to hideout in a small shack in the junkyard, much to Doflamingo's disgust. Barely escaping from constant pursuit, Homing tried to contact Mariejois to save his sons and wife, but the Celestial Dragons retorted how the family cannot return from their choices and coldly hung up. Consequently, the family was stuck living in poverty and on the run, and the two children were beaten up when they tried to steal food; they resorted to eating out of trash bins, and though they brought some food for their mother, she died from illness brought by the deplorable household, much to her family's broken hearts. Eventually, the three remaining Donquixote Family members were found and caught, and then hanged onto a wall above flames, tortured and beaten. While Homing and Rosinante were screaming for mercy, Doflamingo viciously blamed his father for condemning the family to such a hellish life, and snarlingly swore to kill all the commoners in revenge, turning the citizens' hatred to horrified shock.
Doflamingo killed his own Father for doing this. Here is the wiki article for that:-
Two years later, Doflamingo's suffering drove him over the edge, awakening his Haoshoku Haki, knocking out the citizens. Trebol, a knowledgeable 18-years old, saw this as the advent of his new king, gifted Doflamingo with a Devil Fruit and an ornate flintlock. Armed with a viable weapon, Doflamingo killed his own father, for whom he holds with contempt for condemning the family into the life of outcasts. The child then took his father's head back to Mariejois, hoping to return to the privileged life as a Celestial Dragon. Unfortunately for him, the World Nobles already considers the Donquixote Family as a "family of traitors" for fraternizing with commoners, and refused to let him return. However, armed with the knowledge of Mariejois' national treasure, Doflamingo was considered a threat and the World Nobles tried to kill him; they failed and the former Celestial Dragon escaped.
Doflamingo became a pirate with the goal of revenge against the World Nobles who refused to reinstate his status by destroying the world they lord over, and he gathered various recruits whom became a new incarnation of the "Donquixote Family", whom he saw as his new, treasured family.