It's informational. It says that the normal rule that a dollar of foreign-source qualified dividends counts as less than a dollar of total foreign-source income doesn't apply to your client. It explains why the 1116 doesn't match your Excel workpaper that assumes the qualified dividend adjustment applies. This is a separate issue entirely from whether the FTC itself is limited.

Diagnostics are not necessarily suggestions, and they don't necessarily mean you've made an inappropriate entry. They might mean that if you have no idea what they're talking about, you might want to read some forms instructions.