VMware Cloud Director 10.6.1.x
This issue occurs because the VM Placement policy in use was created without VM sizing definitions. VM Placement policies and VM Sizing/T-Shirt Sizing policies are both categorized as Compute Policies. VCD requires that you have one compute policy selected during VM creation or modification in certain Organization VDC types. If the user selects a VM Placement policy which does not have CPU/Memory defined, then they are allowed to specify their own custom compute values.
This is expected behavior.
To enforce VM sizing with VM Placement policies in use, then the VM Sizing needs to be defined within the VM Placement itself as outlined in Create a VM Placement Policy within a Provider VDC in VMware Cloud Director
To limit the maximum compute resources that tenants can allocate to individual virtual machines within an organization VDC, system administrators can change the maximum VDC compute policy.