Error "The video properties of this clip are not standard. To set project properties based on this clip, choose Custom from the Format pop-up menu."

When you click on a still in browser, it makes a selection. The length of this selection is a preference. It defaults to four seconds; you can change it if you which to anything you want. You can also change the length of the still in the project.

Still images are not video. Stills can be pretty much any size or aspect ratio. When you drag a still into a project (unless it's in a standard video frame size and aspect ratio) the application has no idea what you're trying to do. It's asking you what you want to do. Either you can set a standard video preset, or you can select Custom and set any resolution you want and other video essentials such as frame rate, as stills don't actually have a frame rate..