Lady asked if I wanted chocolate on it, and I said "I'm good." She stared at me for a good 10 seconds and then just put chocolate on it. My English friend said that she probably assumed I was slow and said "mmmmm...good."
"I'm good" in the UK still usually means "I'm good" as in "I'm virtuous" or "I'm very skilled at what I do" as in FIGJAM. If you mean "I'm OK", you say "I'm fine" or "I'm well" if the subject is your health but best to just say "No thanks" when refusing a sprinkle, no matter how virtuous or skilled you are ...