What does this error mean?
This error occurs when variations are added to a listing that is already published without variations.
When the item was published, eBay assigned a "non-variation" Item ID to the listing.
You will need a different Item ID (for variation listings) to edit/create variations.
How to fix:
Sadly, eBay does not allow changing the Item ID, where you will currently need to:
End the listing.
Edit the item to include variations (in the "Ended" folder of Listings),
Relist with variations.