It's been an issue for several LNER services to/from Newcastle lately, has been for a long time. I encountered this issue as recently as Friday last week, but it's been an issue ever since compulsory reservations were introduced. The TVMs at Newcastle often have the issue of not selling you walk up tickets without an itinerary, but then whenever you select any itinerary involving an LNER service it comes up with the error message, the only solution is to select a completely different service from the one you actually want, usually a TPE or another non-reservation TOC service, simply to get the ticket. Then you can go on the LNER website and succesfully make a reservation for the same service the TVM said was unavailable. Same is happening at the ticket office too, they'll say there are no reservations on the service you want so you end up having to get them to make a reservation on a different service or they won't sell you the ticket, but then you can make the reservation for that same service they said was unavailable succesfully online.
This really needs sorting out. It's putting people off travelling by train, I know several people who've had these issues with the TVMs and ticket offices simply trying to get from Newcastle to Durham who've given up and got the X21 bus instead as it's much less hassle.