HDDerase uses the ATA Security Erase Unit command. This requires that a password is first set. If the BIOS has issued an ATA Security Freeze Lock command, then this prevents any application, including HDDerase, from setting a password. That appears to be what the warning message is saying.
Security Freeze Lock is an anti-malware measure that is used by many laptop BIOSes.
Does your PC's BIOS still report the drive's model number and correct capacity?