Hi Garry,
Thank for Posting in Microsoft Community, and I really appreciate how thoroughly you've described the situation.
Let’s break this down and get you moving forward.
Surface Hub 2S is locked for OS migration by default recognizing your USB drive is expected until the Surface Hub 2S is unlocked for OS migration. The firmware is locked to Windows 10 Team, which means it won’t boot from external media like USB until you explicitly enable that capability.
What You Can Do Next
Check the UEFI Version
Go to All Apps > Surface > Your Surface and confirm the UEFI version is into newer version.
If it’s older, you’ll need to update it using a Surface Recovery Image from support.microsoft.com/surface-recovery-image.
Unlock OS Migration with SEMM
On a separate PC, install the Surface IT Toolkit.
Create a SEMM package that enables EnableOSMigration.
Save it to a USB drive named SEMM (FAT32 format).
Here are the most relevant official resources and community threads that might help you with your concern:
Migrate to Windows 10/11 Pro or Enterprise on Surface Hub 2S - Surface Hub | Microsoft Learn
Let me know what you find, and I’ll be happy to guide you through the next steps. You’re almost there!