In order to fix this we need to do the following:
1: Click on manifest -> Edit
2: Change the property 'availableToOtherTenants' from true to false
3: Hit Save
The delete button should now be enabled.
If you have the same issue with a registered app that is of type Web app/ API then you can use the GUI to update this property by going to Settings > Properties > Multi-tenanted and simply change from yes to no.
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