Oh! Unless I've missed a key element to your question, how come you're marking your digital items as physical? There is a separate Etsy setting for that. Right at the top, when you select category, choose "Digital", and then specifically 'What type of item is it?' "Digital" and 'When was it made?' (Yes, Etsy is literally dumb this way; it's got "hand made" so baked into its ethos, you have to say WHEN 🤭 your digital files were made), "2020 - 2026". Once you've got that in place, all other aspects of editing your listing should fall into place. Again, because of the shortcomings of Etsy and their reluctance to cater for their sellers as well as they do for their buyers, you have to enter a QUANTITY 🤭 for your digital files; enter 999. Unfortunately, if you've got an incorrect setting on all your digital download listings, you need to update them individually: there appears to be no bulk update for this type of change.