Why "laying on the couch" doesn't sit right

What kind of error is it?

Usage error involving the misuse of the verb form.

Why do people make this mistake?

The error stems from the confusion between the verbs "lay" and "lie." "Lay" is a transitive verb that requires a direct object, meaning you lay something down. "Lie," on the other hand, is an intransitive verb and does not take a direct object, meaning you lie down yourself. The past tense of "lie" is "lay," which adds to the confusion.

What is correct?

The correct expression is "lying on the couch," as it uses the correct form of the intransitive verb "lie" to indicate that someone is reclining.