Unable to turn off passcode as it is greyed out on iPad

In addition to the correct answers already posted, changing or removing the passcode can also be blocked with Parental Controls.

And you may have inadvertently turned off the ability to change the passcode. Go to Settings/Screen Time/Content & Privacy Restrictions and make sure “Passcode & Face ID” is set to Allow. If it is, change it to Don’t Allow, then back to Allow.

Have you enabled TouchID/FaceID? If so, the ability to disable (i.e. turn off) your device Passcode will not be possible unless you first turn-off TouchID/FaceID.

Aside from TouchID/FaceID, there are many other factors and settings that can hinder your ability to turn-off the device Passcode.

Be aware that removing the device Passcode will disable much of your iPad’s advanced functionality - such as your Keychain within which your Passwords and cryptographic keys are stored.

If this iPad is used for an organization, such as with an Exchange Account or with business-related logins or apps, or with certain device management profiles, the passcode can be required by the organization or the profile.