After creating another test PBIRS server with basic configuration and getting the same result, I gave up and contacted MS support.
While we were going over my configuration with MS support tech and making changes here and there, all of a sudden, I was able to upload the PBIX report.
I took my time and tried to recreate the steps on two of my other servers, prod that did not work and dev that did work. I was able to fix my prod PBIRS server and to break and fix my dev server. Here is what I found.
When I create an SSRS server, I usually remove HTTP or port 80 Web Portal URL (/Reports). I do not want anyone using non-secure access. When I configured PBIRS, I did the same. It turns out, publishing PBI reports requires HTTP access to exist, even though you upload or Save As to HTTPS URL. Not sure why, but that is it.
Now, here is the sequence if you need to recover from the same issue I had: add HTTP (port 80) to Web Portal URL reservation, save, remove HTTPS, save. Now test if you can upload a PBIX report, should work. Now add HTTPS back, should also work. Just adding HTTP when HTTPS already exists does not work.
Turns out, nothing to do with licensing.
Enjoy!
