In the Intel® Quartus® Prime Standard Edition software version 17.1, the error message above may be seen while executing the ip-setup-simulation script on a project targeting a device that doesn't belong to the Intel® Arria® 10, Intel® Stratix® 10 or Intel® Cyclone® 10 families.
The ip-setup-simulation script requires an Intel® Arria® 10, Intel® Stratix® 10 or Intel® Cyclone® 10 Platform Designer folder structure to work properly.