It seems that quite a few people make the same mistake interpreting SetDPMserver syntax on workgroup configuration.
Please note that you either use
(A) the [–updatepassword] with the [–isNonDomainServer] parameters together
(B) the combination [–isNonDomainServer] and [-userName <userName> [-productionServerDnsSuffix <DnsSuffix>]]
but not (A) and (B) at the same time.
Also note that if you use –productionServerDnsSuffix you are working in FQDN mode and should then also use FQDN names with the Attach-NonDomainServer.Ps1 script for the –PSname parameter.