Can an artificial Dungeon biome be created?

It is, theoretically possible to re-create certain biomes in terraria, but without any sort of modding instrument, it is nearly impossible, unless you want to spend LITERALLY hundreds of digging and then replacing blocks.

The mechanic is, which i'm sure you're aware of, that if enough of a certain type of blocks are in an area, certain mobs will spawn and it will be considered a 'biome'. a good example of this is when a meteor crashes onto the map, replacing several hundered blocks in a circle around the point of impact with meteorite ore. Once a certain amount of meteorite blocks are onscreen, the mob 'Meteor Head' will spawn rapidly. It is possible to re-create this effect by placing a certain amount of ore in another location, spawning the Meteor Heads and allowing for good farming action.

The same effect is present for dungeons. However, the amount of blocks needed to re-create the biome is MUCH higher. And you need both the blocks and the wall sections for them it work. I personally made a castle out of the blocks from my dungeon, both the walls and the backgrounds, and i never had any mobs spawn in my base.

Regardless, any artificially created dungeon biome would not have any of the naturally occuring items, like chests, bookshelves and the like.

So, long story short, yes, it is POSSIBLE, but the work and many hours involved would probably not be worth your time. Hope this helps.