Update only Microsoft 365 apps

Your goal is to manage Microsoft 365 Apps while keeping Windows updates under separate administration. I would not assume that removing an Autopatch-created update ring assignment makes the configuration a supported app-only deployment. The greyed-out option you describe needs confirmation for your tenant; I cannot validate that workaround from Microsoft's documentation.
For this requirement, evaluate cloud update in the Microsoft 365 Apps admin center. Microsoft recommends it for managing Apps updates, with channel management, rollout controls, and reporting. Start with a small pilot, confirm device eligibility and the intended update channel, then verify that the pilot receives updates and reports correctly.
Cloud update takes precedence over other Office update policies, so coordinate that transition rather than expecting both tools to manage the same Apps installation. Keep Windows quality, feature, and driver updates explicitly managed through your chosen Windows policies. Ask Autopatch support before modifying service-created assignments.