You want to delete the snapshot but ended with following error,
Failed to delete the snapshot xxx of the virtual machine yyy
Could not merge the medium nnn to mmm (VERR_INVALID_PARAMETER)
** We encountered the error because we have created a snapshot before the VDI resizing. Also, whenever you open the Windows Disk Management (diskmgmt.msc) – You will not see the unallocated space.
Aside to that, you will also see the status Dynamically allocated differencing storage from Settings > Storage > Information area.
So, to completely delete the snapshot – You will need to restore the snapshot . Once restored, you can safely delete the snapshot. The virtual machine will be in saved state in which you need to discard the saved state in order to bring up the virtual machine.