Hi Alex,
I have encountered that same error message in my Workspace ONE UEM+Access environment with iOS devices that are enrolled with a multi-user staging account. If the user account being used to check the device out of its initial OG into the target OG is not hierarchically above the target OG, the error message (Chek out LG is not authorized) pops up. To test this theory, please re-attempt the check-out procedure with a user account that is explicitly created/managed at the OG you are attempting to check the device into.
-Andrew Davis