Cannot create RDS SQL Server instance with easy create option

The error you're encountering suggests that there might be an issue with the subnet configuration or visibility of subnets to RDS, rather than an actual lack of subnets in your VPC. Here are a few things to check and try:

1. Ensure that your subnets are in different Availability Zones (AZs). RDS requires subnets in at least two different AZs for high availability.

2. Verify that the subnets you're using are associated with the correct VPC. Sometimes, subnets may appear in the list but might not be associated with the VPC you're trying to use.

3. Check if there are any Network ACLs (NACLs) or Security Group rules that might be restricting access to these subnets. Ensure that the necessary ports for RDS (typically 1433 for SQL Server) are open.

4. If you're creating the DB subnet group manually, make sure you're selecting at least two subnets in different AZs.

5. Try creating the RDS instance without using the "Easy Create" option. This will give you more control over the configuration and might help identify where the issue lies.

6. Ensure that your IAM user or role has the necessary permissions to view and use the subnets in question.

7. If possible, try creating a new VPC with new subnets specifically for this RDS instance to rule out any issues with the existing VPC configuration.

8. Check if there are any Service Control Policies (SCPs) in your AWS organization that might be restricting subnet or VPC usage for RDS.

If none of these steps resolve the issue, you may need to contact AWS support for further assistance, as there could be an underlying issue with your account or the RDS service in your region.
Sources
why did i get a db creating error from terraform | AWS re:Post
Troubleshoot INCOMPATIBLE_CREATE issues due to missing instance profile permissions during Amazon RDS Custom instance creation | AWS Database Blog
Amazon RDS examples using AWS CLI - AWS SDK Code Examples