No, please do not remove that device at all.
If your license is retail, there's no limit, but typically you cannot transfer between different hardware frequently within 72 days if I rememebr that correctly - that is to prevent users from using one license on two devices by switching back and forth.
Sometimes device registeration on Microsoft account can read info wrong, and when you think the license should be link to one device, but the device info reads something else. I've seen that in this forum from time to time, but it can still work. This is why I am asking you to check that box and click on Activate, see if it works.