To reproduce:
1. Create a game object
2. Add an animation using the animation window
3. Replace "Animator" component with "Animation" component
3. Drag the animation onto "Animation component"
5. Select the animation
6. Error occurs stating that animation must be set to legacy mode

Expected result: You can set legacy mode in the animation asset inspector
Actual result:The animation asset inspector does not expose any "Legacy Mode" toggle

Workaround:
1. Switch inspector to "Debug" mode.
2. Change "m_AnimationType" from 2 to 1.

Workaround 2: When you create Animations in the AnimationWindow, make sure you have an Animation component ( not Animator ) on the target GameObject.
This will make the AnimationWindow create Legacy type animation