This is rather late, but I'm currently doing it this way...
I'm following these instructions found here:
https://support.google.com/googleplay/android-developer/answer/2481797?hl=en
There is a lot more information here: http://developer.android.com/google/play/expansion-files.html
You will have to upload the APK and publish the application to test the expansion files.
Use the ALPHA option so that the application is not visible to everyone.
After the application is published you can test your expansion file correctly. If you are planning a paid application, instead of paying just upload your APK from Eclipse or Android Studio directly.
As for your error. You will have to make sure you "publish" and that the application is visible in the play store before you will have access to the expansion files for testing.
I have also read in many other posts that you may test expansion files while in draft mode.
This is now FALSE. explained here https://support.google.com/googleplay/android-developer/answer/6062777?hl=en