Same issue, later Sonoma version. The Terminal consistently returned the "can't bless" message. Tried from both Monterey on an M2 MacBook Air and from an M1 Mac Mini. Kept failing. No MacOS system settings / software tweak or Erase settings would resolve it.
Tried a different USB drive and it went through the first time (on MBA - have not tried again on Mac Mini).
The USB drive that failed is brand new. It's a SanDisk Ultra Dual Drive 3.1 Luxe 64GB which has specified read speed of 150MB/s (write speeds don't get specified by WD/SanDisk). Gets ridiculously hot as soon as I insert it in a USB C port on any machine. And consistently fails to become a working Sonoma bootable installer.
Then I tried a much older USB drive that has DTmicroDuo 3C written on it. Also 64GB, but it appears slower than the SanDisk one. Gets warm while putting the Sonoma installer on it, but not hot. No problems with this one other than the time it takes to copy the whole Sonoma installer to the drive. It was slow. Went through the first time tho. No changes to settings in MacOS between last failed and the successful attempt.
Don't know what difference between these drives is relevant to the success on the older USB drive.
Try another drive. Maybe it works for you too.