Your problem is that "I saw it written on the T-shirt" is in the past tense while "but I can't understand it at all" is in the present tense. Also The correct phrase: "I saw it written on the t-shirt but I couldn't understand it at all..."

Nope, doesn't make any sense.

跳舞的氛围？ means dancing environment?

As a Chinese, I can't understand it either But I guess the whole is ： 跳舞的音乐氛围？

It means: "The mouth of the dancing sound." in Mandarin.