Sam:

You should have no problem changing the vendor on an open PO or during the copy of any PO. I believe there is an issue with changing the header vendor not changing the selected vendor on the detail lines depending upon Company Profile options but I don't recall that it gave the error you indicated (in fact it gives no error but doesn't do what you think it should). Different setup options might overcome this.

To start it would be helpful to know:

What version of PO?

In the current version on the Company Profile System Options tab (may be in a different location in older versions) there is an option "IC Item vendor check". Which option is selected?