"I am alone, and miserable." How does this quote from Chapter 16 link to the theme of isolation?

There are plenty instances, as one of the main themes in the story is isolation.

On Ch. 16, the complete sentence reads:

I am alone, and miserable; man will not associate with me; but one as deformed and horrible as myself would not deny herself to me. My companion must be of the same species, and have the same defects. This being you must create."

The monster had been wondering for a while, after realizing his isolation is not only from society, but from humanity. He is depressed because, like he says after inhabiting the cottage, and experiencing the beauty of women, not being able to do anything about it, and experiencing human emotion while trapped in the body of a monster:

I felt emotions of gentleness and pleasure, that had long appeared dead, revive within me. Half surprised by the novelty of these sensations, I allowed myself to be borne away by them; and, forgetting my solitude and deformity, dared to be happy. Soft tears again bedewed my cheeks, and I even raised my humid eyes with thankfulness towards the blessed sun which bestowed such joy upon me.

The realization of needing a partner, namely a female, shows the human need of connection, communication, and emotion. It also reveals his own capacity for it, and it shows the inner conflict of the poor monster who finds himself a lonely wanderer.

The story of Frankenstein begins with Walton, the explorer to whom the story was conveyed, who is-himself- isolated and lonely as he explores those faraway lands. He finds Victor who is, at that point, a lost man also as lonely and left by society as can be.  It is a series of lives touched by all forms of isolation not only from others, but from their sense of self.