Hi Lillian Li,
In Dynamics 365 item on the sales order line has a setup for reservation hierarchy in such a way that all dimensions below location will be determined by warehouse management module and should not be entered manually on the sales order line if you want to use advance warehouse management.
Kindly share the screenshot of the item reservation hierarchy and the sales order lines details sections for the product tab.
Normal case as an example which works fine is below
Item reservation hierarchy

As you can see you should only specify site, warehouse and inventory status on the sales order lines as marked in green.
All dimension below location should be blank on sales order line.
So in this example I would make sure that location, license plate, batch number and serial numbers are blank before clicking release to warehouse,