Hi B.,
First, kids at this age nearly always answer "no" when you ask them if they need to go. Sometimes they are just not understanding their body's cues, sometimes they are busy playing.
When I started off with helping little ones use the toilet, I would give them a warning "Potty time in two minutes" and then "It's time to use the potty."
"It's time to..." is almost magical-- there's no question, there's no debate, it's just a fact.... Depending on the child, I would take them every twenty minutes or so until I could gauge how often they were really needing to go.
By all means, take him out in diapers until he can stay dry at home more or less on his own. Often, it's the toilets outside of home that can throw kids off, usually because of the size and the sound.
If it were me, I'd also let him wet himself every so often, as a motivation to stay dry. Make sure he's in training pants-- not pull-ups-- so he does have the realistic experience of wetting himself. It sounds like he isn't quite caring about it as much as you care. Perhaps he needs to come to understand that using the toilet is about staying dry, and learn to respond to his body's cues... Hard if they aren't motivated to the same degree we are, huh? If you are in earnest about this, prepare yourself for lots of accidents-- for some kids, they really have to get tired of having to break off play for longer and go change their clothes before they really decide to stop what they are doing and go on their own.
You might also ask him 'can you feel when you need to go?' Some kids just don't 'get it'. And play naked in the backyard whenever you can let him, if you can. Sometimes, this is a good way for them to really learn the connection between those internal cues and 'going'.
Good luck!