it seems that the SFTP server that you use is unable to retrieve the length of the already opened file. This is a not related to a version of SFTP protocol, but rather a feature/bug of the SFTP server. It might be worth reporting it to your SFTP server vendor.
More details: when Rebex SFTP asks for the stream.Length, (this is done via SSHFXPFSTAT command), the server replies with "Failure; The message  is not extractable!."
As a workaround please try to retrieve the remote file length before actually calling the sftp.GetStream and then pass the already retrieved length to your custom method like this:
long fileLength = sftp.GetFileLength(fullFilePath);
using (Stream remoteFileStream = sftp.GetStream(fullFilePath, FileMode.Open, FileAccess.Read))
< some custom object>.SaveFileFromStream(remoteFileStream, fileLength, < other params>, ...);
Let me know whether it helped to solve your issue.