We report the results of extensive molecular dynamics simulations of a simple, but experimentally achievable model of dipolar colloids. It is shown that a modest elongation of the particles and dipoles to make dipolar dumbbells favors branching of the dipolar strings that are routinely observed for point dipolar spheres (e.g., ferrofluids). This branching triggers the formation of a percolating transient network when the effective temperature is lowered along low packing fraction isochores (phi<0.1). Well below the percolation temperature the evolution of various dynamical correlation functions becomes arrested over a rapidly increasing period of time, indicating that a gel has formed. The onset of arrest is closely linked to ongoing structural and topological changes, which we monitor using a variety of diagnostics, including the Euler characteristic. The present system, dominated by long-range interactions between particles, shows similarities to, but also some significant differences from the behavior of previously studied model systems involving short-range attractive interactions between colloids. In particular, we discuss the relation of gel formation to fluid-fluid phase separation and spinodal decomposition in the light of current knowledge of dipolar fluid phase diagrams.