I saw the same exact error message when I was starting to use XCode Cloud this weekend to do testflight builds for an app that was already being distributed via testflight. When the XCode Cloud creates builds, it starts off with build #1, but I had already done builds 1 through 5 in testflight. I'm glad it was a relatively new app because when I finally got up to build 6 in XCode Cloud, testflight started accepting my builds. I wrote up a bug/suggestion to ask Apple to allow us to start off the builds at some number other than 1 so that XCode Cloud would be compatible with apps that were already being used with Testflight. It's entirely possible that your issue was caused by something completely different, but I wanted to let you know of this one possible cause of the issue.