SagePay needs shipping details, this is taken directly by the plugin from the woocommerce order object. Would there be any reason why in this particular order doesn't require delivery details or is this happening on all orders?
Versions are all upto date, which I have already tested.
For simulator and test you should only use test cards. You can't test the postcode in woocommerce because of it's own validation and it's not a problem it's failing, it's just a warning letting you know that an invalid postcode was used.
also, the first line of the address only needs to begin with 88 to validate - you can enter '88 High Street' for example
The message makes sense based on your request - this information is mandatory and it will fail.
Is this a collection or a download, should it have a delivery address.