The update status we send across to WooCommerce after we book your shipment in is limited to 20 characters. If the status is any longer than this you will see a 400 error on your shipments. This indicates an error occurred when trying to update the orders.
Here is a blog post from WooCommerce on custom order statuses which may help explain things further.
You can find more information about how Shiptheory can use WooCommerce statuses here.
If you have any queries or questions about this feel free to contact support.