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TechNote mg245554 discusses lots of reasons for the 5709 error. The first solution fixes the error about 95% of the time and the first three combined fix it about 99% of the time.
Start at the top and work your way down through the solutions.
It turned out that the problem seems to be that I didn't assign pin numbers to hierarchical composite blocks. Is this
really a requirement!? In my hierarchical schematics, blocks don't represent a physical thing with pins. I give
the pins names matching the net names. Why would they need pin numbers?
After numbering them, I hid the numbers because they look silly left on
Also, if I set pin numbers this doesn't seem to affect the pinorder during netlist generation -- I thought
that might be a reason for them. So I remain puzzled why the apparant
requirement to number pins on blocks, unless this is just a misfeature.
You shouldn't need pin numbers on hierarchical blocks, as you rightly say they don't represent a physical part. Either there is something else on the block triggering the need to package (check the Forward to PCB property isn't set to True, though even this doesn't seem to affect this step) or there is something wrong with your configuration file. From a simple test I'm not seeing this behaviour.