Apple Watch SE 3rd gen says incorrect passcode for other iDevice and won’t complete setup

I am trying to activate my daughter's Apple Watch SE 3rd Gen on my iPhone. I select "Set Up for a Family Member". My daughter also has an iPad. After selecting her as the family member who will be using the Apple Watch, I enter her iCloud password. Everything seems to be fine up to this point. Then the watch tries to signing to my daughters Apple account where it asks for her passcode that she uses to unlock her iPad, I enter the passcode however the watch keeps saying incorrect passcode.