To confirm: when you get this error you’re attempting to build/run in Visual Studio, not in the Unreal Editor?
Meanwhile I remain perplexed. The AppxManifest.xml file you provided validates for me in VS using the same schema set that UnrealBuildTool applies Specifically for the 10586 SDK these are:
Windows Kits\10\Include\10.0.10586.0\winrt\UapManifestSchema.xsd
Windows Kits\10\Include\10.0.10586.0\winrt\FoundationManifestSchema.xsd
Windows Kits\10\Include\10.0.10586.0\winrt\AppxManifestTypes.xsd
Windows Kits\10\Include\10.0.10586.0\winrt\AppxManifestSchema2010_v2.xsd
Windows Kits\10\Include\10.0.10586.0\winrt\AppxManifestSchema2013.xsd
Windows Kits\10\Extension SDKs\WindowsMobile\10.0.10586.0\Include\WinRT\AppxPhoneManifestSchema2014.xsd
Additionally I’ve confirmed that I’m able to manually run makepri against that file + a Resources directory and get valid output. I do see that your folder contains a resources.pri, which suggests that makepri succeeded at some point. Any idea what might have changed?