Yes, I was able to update the hosted feature service using Python, but I had to republish the service each time from an MXD. This process is fairly involved. You have to create a service definition draft, analyze it, generate a service definition, upload the service definition to ArcGIS Online, republish the service from the service definition, and reapply the service item info and item data to the overwritten service. Creating the service definition draft involves arcpy.mapping and modifying XML. To make the primary REST API requests, you have to make many other requests to look up the service and service definition item ids, item info, item data, item metadata, item folder id, and item folder name based on the service name. Uploading the service definition is a multipart asynchronous process. Publishing the service definition is also an asynchronous process that multiple REST calls. Finally, when you overwrite the service definition and service items, you lose most of the item info, item data, and metadata in the process. This requires more REST calls to reapply that information to the new service definition item and the updated service item. This is necessary to retain your popup configurations, item descriptions, and any item properties you usually set in AGOL.
Also, the AGOL Assistant probably uses the same REST endpoint (applyEdits) to update item data, so it makes sense you would get the same issue.
Thanks,
Nathan