The effect of “Dreamsprite” is not optional so if you have at least 1 other monster on the field when “Dreamsprite” is attacked, the attack target is changed to your other monster. This is also true if “Dreamsprite” is attacked when face-down.
If your “Dreamsprite” equipped with “Ring of Magnetism” is chosen as an attack target, and you control another monster, the effect of “Dreamsprite” will still change the attack target to your other monster.
If you control “Dreamsprite”, “The Legendary Fisherman”, and “Umi” is on the field, “Dreamsprite”’s effect can still change an attack target to “The Legendary Fisherman” because he is not being targeted with an attack, but is being targeted with a monster effect.
If you control two “Dreamsprites” and one is attacked, you cannot continue to switch the attack target between the two “Dreamsprites” because the effect of “Dreamsprite” says that you must calculate damage on the new target.