When you do the quest where a group of refugees wants to stay with you for a while, one of the possible outcomes is that they betray you and turn hostile.

Currently, when you have that outcome the Gene Ripper does not allow you to use it on any of them which you take prisoner. My guess is because it still considers them as lodgers/guests, which aren't eligible for gene ripping. Which is obviously a bug.

The workaround is to enslave them. You can use the ripper on them after they are enslaved. I assume this would also be true if you recruit them rather than enslave them, but I didn't try that.