Automatic passkey upgrade not working

Seeing the following error when attempting automatic passkey upgrade - [Warning] NotAllowedError: The request is not allowed by the user agent or the platform in the current context, possibly because the user denied permission.

We're trying to enable Automatic passkey upgrade (https://developer.apple.com/videos/play/wwdc2024/10125/?time=38) for our website but it's not working from our testing on iOS 18.2 and 18.3 Beta Safari. The flow on our website looks like:

1. the customers use autofill to fill out email and password on the sign-in page (abc.com/signin)
2. PublicKeyCredential.getClientCapabilities is called to check if conditionalCreate supported.
3. land on another page of our website (abc.com/pageX), which calls navigator.credentials.create with mediation conditional (Right after sign-in).

We checked that we followed the steps in above video: Allow automatic passkey upgrades is enabled, mediation is set to conditional and password autofill is used to signed in. However, Safari threw an error [Warning] NotAllowedError: The request is not allowed by the user agent or the platform in the current context, possibly because the user denied permission.

Can Apple help guide us if anything is missed here?