It is kind of a nuisance, but when performing an Update Query, all objects involved in that query must be updateable (even if the un-updateable ones are not the ones you are trying to update!).
Therefore, if you are using a linked Excel table, aggregate query, or some other un-updatebable object in your Update Query, it will not work.
There are a few workarounds, like importing the linked table directly, as you have seen. Or, you can create a Temp Table from your linked table, and use that in your Update Query instead.