I use Systemless Hosts for AdAway as well, and have never needed to disable it when updating. The module does not change anything in /system; instead, it "hijacks" where the kernel looks for the hosts file and redirects it to the custom hosts file managed by the ad blocker.I do use AdAway so that explains that. But it was still under modules, so I think I did the right thing by uninstalling it before trying (and failing) to update.
I also use Universal Safetynet Fix and MagiskHide Props Config; I haven't needed to disable either of these when updating.