I tested it and it works fine now. You need to delete the old settings in the project and set them again inside the NPC so that the old settings are not still used.
The error is now fixed but the issue of balloon icon not showing on top of the NPC is persists for me. I used a new RPGM project just to be safe. don't know if it matters but I'm using v1.9.0 version of RPG Maker MZ.
