I just spent far too many hours trying to set up a new Nest thermostat and kept getting the E294 error, tried tried the recommended trouble shooting, no help. Rechecked and reinstalled wiring multiple times. Finally on my last go before reinstalling the old thermostat I got it. Important this is for a gas furnace not sure if it helps if you have something else.
What I did was removed the device in Home app as recommended, factory reset the thermostat as recommended but here's the important part. When you go to reinstall, right after you scan the QR, DON'T go through the normal set up process. Instead you will see in the lower left corner a prompt that say installation complete. Click that instead. It should then ask for which wires you connected. In my case W, Y, R, G and C then next. And it will take you to a page you haven't seen yet which asks you what type of furnace you have once you switch to gas from the default (electric) and finish the set up the error code is gone and the thermostat works.
Not sure why this screen isn't part of the initial setup or if it can be reached another way but it's definitely an issue with the setup process.
Hope this helps someone because that was extremely frustrating.
Moderator edit: Subject updated for clarity and findability.
