Hi @geofflo,
Welcome to UQWorld! 
This sounds very similar to an issue another user had recently. Have a look here: After update receiving error in uq_blockwise_inverse
The fact that the algorithm ends up in this part of the code (where a regressor that was added by LARS has to be removed again) hints at some problem with your data: it does not contain enough information to properly build a PCE.
I hope this helps, good luck!