I suppose it really depends on how you define a military dictatorship. I mean we're only talking about 250,000 odd people a fair portion of which are aliens and/or in transit and most of the ones that live on the station work there either as Earthforce officers, Security officers, dock workers, maintenance techs, medlab personnel and various small business owners, their employees and of course the lurkers.
Also keep in mind that unlike say a planetary colony, B5 is a space station and it can only support so many people. Not just in terms of square footage but in the ability of the life support system to supply breathable air (of various mixtures) process waste and accommodate the water, power and food requirements of all those people. Once that limit is reached, that's it or people will start to suffer and die. So they're not a growing independent society, they're a bunch of people in a can.
Now even before the secession all of these people lived on what was essencially a small colony under a military governorship, which while it answered to senate authority, the station and it's populous had no direct representative to the senate for themselves (neither did any of the colonies for that matter) and no say in wider politics beyond the alliance wide presidential elections (as seen way back in the first episode.)
All that's really changed on a day to day basis is that Earth no longer has any say, nor dose it provide funding or collect taxes. The residents are still subject to the usual civil laws, rights, due process etc. What's to stop Sheridan going power mad and treating the station as his own little kingdom? Aside from Ivanova, not very much, but this isn't intended to be a permanent situation, as the Captain said in 'Severed Dreams', they intend to rejoin the Alliance on the condition that Clark is removed from power.
Drawing up a constitution would seem to be a bit pointless and counter-productive at this early stage, even if it is ever going to be an issue.
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