Make sure that the paper guides are touching the edges of the paper in tray 1. Also, make sure that you have set the paper size and type at the printer. (I know that you have it set up in the driver but I'm not sure you have it setup in the printer which is why the printer could be asking for that size paper.)
After loading the media in tray 1, the printer will display a size and type based on paper guide placement and previous paper type setting. If this is correct press OK. If not, scroll to change and press OK; select the correct paper type and size, then press OK.
I hope this helps, but if it doesn't, please post back and let us know.