bt_hci_core: HCI driver open failed (-11) on nrf5340 custom board

I am getting a bt_hci_core: HCI driver open failed (-11) with a custom board using nrfConnect for VS Code and 2.9.1 toolchain/sdk.

The code is really simple (I'm not using the callback for simplicity):

#define DEVICE_NAME             CONFIG_BT_DEVICE_NAME
#define DEVICE_NAME_LEN         (sizeof(DEVICE_NAME) - 1)

static const struct bt_data ad[] = {
	BT_DATA_BYTES(BT_DATA_FLAGS, BT_LE_AD_NO_BREDR),
	BT_DATA(BT_DATA_NAME_COMPLETE, DEVICE_NAME, DEVICE_NAME_LEN),
};

bool ble_ready = false;




void bt_ready(int err) {

    if (err) {
        LOG_ERR("Bluetooth initialization failed (err %d)", err);
        return;
    }
        
    LOG_DBG("Bluetooth initialized successfully");
    ble_ready = true;

    // Add your service initialization code here
    // For example, register GATT services, characteristics, etc.
}



//create a service
int ble_service_init(void)
{
    int rc = 0;

    // Initialize Bluetooth
    rc = bt_enable(NULL);
    if (rc) {
        LOG_ERR("Bluetooth init failed (err %d)", rc);
        return rc;
    }

    LOG_INF("Bluetooth initialized successfully");

    // Add your service initialization code here
    // For example, register GATT services, characteristics, etc.

    return rc;
}

I have this call in main before the loop:

	ble_service_init();

I have this in the prj.conf:

CONFIG_BT=y
CONFIG_BT_PERIPHERAL=y
CONFIG_BT_DEVICE_NAME="BLE Test"
CONFIG_BT_LOG_LEVEL_DBG=y

I also have a sysbuild.conf with:

SB_CONFIG_NETCORE_HCI_IPC=y

Error log:

00> [00:00:00.252,349] <dbg> bt_hci_driver: bt_ipc_open: 
00> [00:00:01.253,356] <err> bt_hci_driver: Endpoint binding failed with -11
00> [00:00:01.253,387] <err> bt_hci_core: HCI driver open failed (-11)
00> [00:00:01.253,387] <err> ble_service: Bluetooth init failed (err -11)

I read these but they didn't really help:

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