From what i can see on the pictures you posted, the error tells you to select the main parent of the chain
the last selected bone (the active bone) is only used as a pivot point so no physics will be applied to it
I made this check to prevent dependency cycles. the active bone must always be the first bone of the chain or your selection. And you should be careful on what to use as a parent because it makes a big difference.
For the presets, no the folder path is hardcoded so you cant really use your own for the moment you need to stick with the folder the addon is pointing at.
for the second part i don’t really get what are you trying to do but from what i understand you want to keep the physics effect while keeping the ability to move bones ? If this is the case you can do that with a little bit of work. basically you need to use the hook modifier with an empty on the mesh that the addon generates. I am working on an update that does this automatically, hopefully i can release that in the upcoming days.
If you really can’t figure out how to use it properly hit me on discord Nickname: Morelewd#8326 I will be glad to help
One last thing, this addon doesn’t work with proxy bones (bones that drives other bones).So you need to select the bones that are tied to the mesh directly
Hope it helps !