In general you can with most ODBC linked tables. I had no problem with linked SQL Server or Oracle tables. This one only applies to linked CSV files - at least that's the type I've encountered it. I wasn't actually trying to update the CSV file. I was merely using it to join with another linked SQL Server table to identify the rows to update there. I know updating the SQL Server table is not an issue as I'd done it many times. Apparently the limit imposed by the ISAM is indiscriminate enough that it doesn't distinguish which table's columns the query is trying to update - as long as the ISAM support link is used in some fashion, UPDATE won't be supported.
BTW, I assume ISAM mentioned here is the driver used by the Jet engine to link flat files. Amazing how an old term like ISAM - Indexed Sequential Access Method - still survives, which goes back to the early days of mainframe database. Algorithms do have a much longer shelf life than hardware. I bet you can't find any reference to "magnetic core" these days except in computing history articles, which isn't something older than ISAM.