I am having the same issue. The error does say it is missing the "com.apple.developer.system-extension.install". As far as I can till, this entitlement should be available in my iPadOS application.
I would like to note that both the documentation you have linked and our developer portal for enabling this entitlement both mention this API is macOS only.
I am using:
XCode 26.4 Beta 2 on macOS 26.1
iOS 26.4 beta 3
Topic:
App & System Services
SubTopic:
Drivers
Tags: