Are these items lot-based or serial-based?

I am not sure, we don't utilize all the features on Sage. We don't use item-kitting if that helps assist your question. The items are stored in bin-locations with SKUs defining them. I would assume that means lot-based?

Look at the item valuations.  The "T" lines in your job log imply Lot / Serial cost tiers.  If you invoice manually and you don't do the quantity allocations you would get the same error.

Looked into that now, I only have the 'From' bin location since I'm not trying to move it to a new location I'm taking it out of inventory.. could this cause the HS record to fail though? (does HS stand for 'header start'?)

Additionally this is what our 'sales order entry' looks if we were to enter it manually:

This error message is because your inventory is either Serial, Lot or FIFO and you are attempting to import without including the Serial Number, Lot Number of FIFO tier as part of your source file.   These are the "T" lines that Kevin is talking about. 

I am running into the same error message.  I've verified all of my inventory is Average Cost method. Did you end up finding your inventory was Serial/Lot/Fifo?