please check if Forced Encryption is enabled. This setting within the Bitlocker policy should be disabled when performing device wipe.
If this is not the case, what do you see on the screen, are you able to share screenshots?
Also, have you tried performing a manual Device Wipe? You go to Start and type Reset my PC and step through that. It effectively performs the same function. You may need to delete the device record in the console if that works.
Also you can initiate this from the Troubleshooting Console on the device itself.