BLOOD levels of DHT have very little correlation to hair loss--unless it is very excessive (like high amounts of Testosterone replacement converting to DHT or anabolics that are DHT based for example). In fact, most men that lose their hair or even get prostate issues rarely suffer from high T or DHT but it is opposite (teen boys have great hair and usually high testosterone---50yr old men usually thin and have prostate issues and have lower T).
It is fully a dysfunction in the follicle itself. For some reason there is androgen dysfunction in balding scalps/follicles. Finasteride works because it inhibits the enzyme that converts testosterone INSIDE the follicle to DHT which is the acting androgen in this tissue/follicle. Testosterone itself really does not act inside the follicle which is why it is converted to DHT. Higher conversion to DHT--higher androgen activation and more oxidative stress due to higher enzyme activity leading to immune reactions.
Finasteride inhibiting DHT in other regions, like the prostate, which further decreases blood DHT really does nothing for hair loss and contributes to side effects.