why won't it let me spend my apple gift card when it says it can be used for in app purchases

I don't see anything in the picture that says that. Have you redeemed the card? This article explains the different kinds of cards Apple uses and has links on how to redeem them and what can be purchased with each kind. Click on the link --> What type of gift card do I have? - https://support.apple.com/HT204199

Note there are some things that can't be purchased with Apple ID balance:

How App Store and iTunes Store purchases are billed - https://support.apple.com/HT201359

"Which payment method is charged? https://support.apple.com/HT201359

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Some purchases aren’t charged to your Apple ID balance

- If you're in a Family Sharing group, purchases are charged to your personal Apple ID balance. If you don't have enough Apple ID balance to pay for the purchase, the remainder is charged to the family organizer's primary payment method.

- You can’t charge gifts to your Apple ID balance. If you send a gift or gift card, your primary payment method is charged.

- Some subscriptions might not be charged to your Apple ID balance.