I got this message trying to start SharePoint search for querying via-stsadm. As it turns out, Search service has to be running prior to setting the propagation location that will be used for querying.
So now, I firstly start the Search service:
Once Search has been started successfully, I run the command again with the propagationlocation switch:
stsadm –o osearch –action start –role query –farmcontactemail firstname.lastname@example.org –farmperformancelevel reduced –farmserviceaccount domain\SharePointSearch –farmservicepassword p@ssword1 –propagationlocation E:\SharePoint\Query
SharePoint would automatically share the location with the Search account being granted write access.