Apparently UpdatePanel doesn’t work in SharePoint because reasons.
To get it to work, you have to jump through hoops by downloading the SharePoint guidance library thingy as some source code and build it yourself, then deploy it to the GAC of your environment, then add reference to Microsoft.Practice.SPG.AjaxSupport.dll, then use a SafeScriptManager in the usercontrol of your SharePoint webpart.
Maybe it’s better to build the thing using pure HTML and javascript?