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That'll probably be the reason, the paper based Railcard won't come back as a pass in the current Railcard Validation and lead to the error you're seeing
Used a Bradford PlusBus this afternoon, again no issues on First.
Different story on TLC Travel, Ticketer machine rejected, although driver was happy to allow travel
I have sent my complaint off to Arriva, if the PR service was excluded then it really should be listed as so on the PlusBus website (there are plenty of examples of where this is the case)
I only noticed after sitting down but of course there was a big sign on the drivers door pointing to PlusBus!