Keep the faith, Belli.
Definitely continue the water changes and the medication. I have seen fish recover from it, but it will depend on how far it has progressed as to its chances of survival.
You did the absolute right thing by isolating the fish as soon as you realized something was wrong. I wish more people would think to do this when they see symptoms because it minimizes the risk of losing an entire stock of fish.
Tell me what the fish is doing today and if there are any changes that you can see. Is it resting on the bottom of the tank ? Is it laying on its side ? Most importantly, is it eating at all ?
No, Dropsy "itself" is not contagious because it is the end-result of susceptibility from poor general health, but it is a bacterial infection so you will want to eliminate the conditions that could be causing its decline of health. As in the case of most fish diseases, you will want to avoid sharing siphons, nets, and any other equipment between tanks if at all possible. Out of curiosity, when you do your water changes, are you vacuuming the junk from the substrate and the surfaces of your decorations ?
No need to treat the other tank for prophylactic purposes... yet. You don't want to medicate your tank unless absolutely necessary - so keep a "watchful waiting" attitude with the other tank and make sure everyone is eating and swimming properly as these are usually the first signs of illness. We will re-evaluate the medication issue if anyone in that tank shows symptoms.
Most of all, relax. I know it is very disheartening to have a sick fish but you are doing everything possible to save it.

We'll be right here to help so don't give up hope just yet !