Passcode options greyed out on newly paired Apple Watch 9

Hello Jim Upchurch,

Since it does not seem to be working as expected when you try to access that passcode option, have you tried resetting the watch? That may help with this issue. Follow this article for steps: Unpair and erase your Apple Watch - Apple Support.

"Before you start

• If you have the iPhone that your Apple Watch is paired with, you should follow the steps to unpair your Apple Watch. This removes Activation Lock from your Apple Watch as well as erasing all its content and settings. If you don't have the paired iPhone, you can erase your Apple Watch, but Activation Lock will remain.
• If you're using your Apple Watch with a transit card in the Wallet app, remove your transit card from your Apple Watch before you unpair.
• Apple Watch doesn't have a physical SIM slot or reset button — the holes in your Apple Watch case are there to allow sound to and from the microphone and speakers, and to allow water-depth measurement on Apple Watch Ultra. To avoid damage, don't insert any object into the holes in your Apple Watch case.

How to unpair and erase your Apple Watch if you have your iPhone

1. Keep your Apple Watch and iPhone close together as you unpair them.
2. Open the Apple Watch app on your iPhone.
3. Go to the My Watch tab and tap All Watches.
4. Tap the info button  next to the watch that you want to unpair. 
5. Tap Unpair Apple Watch.
6. Tap Unpair [your Apple Watch name].
7. For GPS + Cellular models, choose whether to keep or remove your cellular plan. 

• If you want to pair your Apple Watch and iPhone again, keep your plan. 
• If you don't want to pair your Apple Watch and iPhone again, remove your plan. If you aren't going to pair with a different watch or iPhone, you might need to contact your carrier to cancel your cellular subscription. 

8. Type your Apple ID password to disable Activation Lock, then tap Unpair. 

Before erasing all content and settings on your Apple Watch, your iPhone creates a new backup of your Apple Watch. You can use the backup to restore a new Apple Watch. After your Apple Watch unpairs, you'll see the Start Pairing message.

Now you can set up your Apple Watch again or turn it off if you're selling it or giving it away."

We hope this helps. Let us know if we can assist with anything else at all. Take care.

You will almost certainly require Wrist Detect ON before you can configure your cards in Wallet. I know it is a requirement but I forget which stage it makes itself known, wrist detect was set on my watch long before I added the first card.

Apart from that, exactly where are you looking to try and add cards? Or see the wrist detect and passcode prompts? (I can't guess if this is in the iPhone's Watch app or on the Watch itself)