In your screenshot the server version at the bottom of Tuner X is listed as 2023, which indicates you’re using last year’s Phoenix software (and likely roboRIO image).
The 2023 diagnostics server will result in the error you’re seeing as the “vers. S” Pigeon 2.0 units were not produced until after the season and have different firmware requirements.
Updating to 2024 software will resolve your issue and allow you to firmware upgrade the Pigeon as normal.
This is never intentionally the case - you should always be able to flash firmware regardless of license state. My best guess is that there was either another issue going on that happened to resolve at the same time or licensing the Pigeon somehow worked around the 2023 compatibility issue I described above.