UPDATE: Microsoft has removed its instructions for updating Xbox One without connecting it to the internet.
That said, anyone who runs into difficulties now may be forced to go through Microsoft support channels to get the files they need, rather than simply obtain them from Microsoft's server.
I followed the instructions, so I didn't know why I got an "unreadable disc" error.
After a lot of searching Google for a solution, I found one.
Just download the file, that's all you need to do there.
NOTE: Microsoft stopped updating their backwards compatibility for original Xbox games years ago.