I have done this many many times and it works very well..
I prefer to leave the excel sheet alone after I have put all the data in (read as save it as an excel spreadsheet)
Highlight all the data in the spreadsheet (I normally click the last cell and then add "A1:" without the quotes to the field reference in the top left hand corner of the file. Or you can find the last cell and then press Cntrl + Shft + Home) Press "Cntrl C" to copy the data and then open a notepad document and then Cntrl V to paste the data into the notepad document.
Save this and use it to import the data
I find this method much easier than trying to save an excel file in another format... something always seems to go wrong I.E Excel converts numbers to scientific notation etc...