Configurator 2 - VPP Apps requiring user to sign in

I'm having an issue where after installing our VPP apps using Configurator 2, the user is prompted with the following when trying to open a VPP app on a device:

iTunes Store

Sign in to accept this app and assign it to your Apple ID.

Our apps were previously licensed by VPP codes in Configurator and have been converted to Managed Distribution Licenses so we could migrate to Configurator 2. I have signed into Configurator 2 using our VPP account, and as previously stated, am able to view and assign our VPP apps.

I was under the impression that users would not be required to have an Apple ID for Managed Distribution apps installed by configurator, and when I asked Apple Support prior to the conversion, they stated that to be the case. However, if a user does not enter an Apple ID after the apps have been installed by Configurator, they just close - so at the moment our iPads are useless as they're unable to open any apps..

So I guess I'm asking two questions: is this ordinary behaviour and there was a misunderstanding between myself and Apple Support, or if not, if anybody has any idea what may be causing this?

For the record, if I go to Window -> VPP Assignments I can see that our VPP licenses ARE being assigned to iPads.

Thanks, Ed