Psoriasis: Given the patient's response to OTC steroid cream, which helped relieve redness, and the description of the patch as red, dry, and flaky, psoriasis is a strong consideration. Psoriasis can appear anywhere on the body, including the genital area, and can be triggered by various factors, including stress and infections.

Eczema/Dermatitis: The patient's improvement with steroid cream also points towards eczema or dermatitis, which are common conditions that can cause red, itchy, and flaky skin patches. The genital area can be affected, and the condition can be triggered by irritants, allergens, or even friction.
Lichen Planus: This is an inflammatory condition that can affect the skin and mucous membranes, including the genital area. It can cause purplish, itchy, flat bumps, but in some cases, it may present with a more psoriasiform appearance, especially if the patient has been scratching the area.
Seborrheic Dermatitis: Although less common in the genital area, seborrheic dermatitis can cause a red, flaky rash. It's more typically associated with oily areas of the body, but it can appear in the genital area, especially if there's an overgrowth of Malassezia yeast.

Syphilis (Secondary): Given the patient's history of unprotected sex, syphilis must be considered. Secondary syphilis can cause a wide range of skin manifestations, including patches that might resemble psoriasis or eczema. It's crucial to test for syphilis due to its serious complications if left untreated.
HIV-Related Dermatoses: Certain skin conditions are more common in individuals with HIV/AIDS, including seborrheic dermatitis, psoriasis, and others. The history of unprotected sex raises the possibility of HIV infection, making it essential to consider and test for HIV.

Pityriasis Rubra Pilaris (PRP): A rare skin disorder characterized by constant scaling, redness, and thickening of the skin. While it can appear anywhere, it's less likely to present as a singular patch on the penis.
Mycosis Fungoides (Cutaneous T-Cell Lymphoma): A rare form of skin cancer that can mimic various dermatoses, including eczema or psoriasis. It's unlikely but should be considered if the lesion is persistent and unresponsive to treatment.
Fixed Drug Eruption: A condition caused by an adverse reaction to medication, which can cause well-defined, circular patches that are red and can become blistered or eroded. It's less likely given the description but could be considered if the patient has recently started new medications.