Hi, my friends and I recently got back to classic and started playing. About 5 hours in we realized the server we picked is listed as inactive (though this wasn’t apparent when choosing server).
Game seems to offer a free character transfer but no matter what server option I type in, it won’t allow me to press the Continue button. Obviously we want to play the game with more than 3 players.
Are we screwed? I fear starting over is gonna be the killer for our return to classic 
If you cannot pick any realm, it means Free Character Migration is not enabled for that realm.
The current list of FCM:
https://eu.forums.blizzard.com/en/wow/t/transfer-restrictions-and-free-character-transfers-now-available-updated-22-november/379506
Usually it goes from high to low pops and not vice versa. If you want to play your existing toons you’ll have to pay for a character transfer, that and you cannot move to Locked realms with the transfers anyway.
If you do decide to transfer I recommend to check out the respective realm forum, create a level 1 toon on prime time and talk to peeps to see how the average atmosphere is and (not quite reliable) 3rd party population sites to make your next pick.
Blizz really oughta warn people if a server is disconnected and inactive when picking it
Zandalar Tribe is not disconnected… As for “inactive” that is a player choice. Some do not like the busy realms due queues, their friends not being able to join them etc etc.