I have opened several DGN that have been linked to a Workset. When I try and add them to the sheet index. All of them report and error stating they are not linked to a workset.
Yet the properties say they are.
There should be a WorkSpace field under the WorkSet properties.
Can you follow the instructions in the following wiki to disassociate the file:
You should then be able to reassociate to the WorkSpace and WorkSet.