I didn't realize you needed an sd card. I thought the files were downloaded to the import folder of internal memory, which is where they go when downloading from the eshop, then they're moved to the appropriate location during installation.
That's not 100% correct: The files get installed to the import folder, then moved to the final destination.
Anyway, the issue here wasn't related to this at all but it was NUSspli updating itself. For that it downloads the zip file from GitHub to RAM, extracts it to a temporary folder on the SD card and then either installes it (channel) or moves it to the final destination (HBL). So, as
@Lostbhoy assumed, the issue was no space left on the SD card to create the temporary directory.
P.S. We do this temporary directory on SD as the user might not have a USB drive connected and we don't want to wear out the NAND.