[SalesForce] ContentDocumentLink Throws an error using ContentVersion Object “ContentDocument ID: id value of incorrect type”

Have a look at the Content Objects Data Model for the relationship between ContentVersion and ContentDocument.

One ContentDocument can have one or more ContentVersion records. The ContentVersion contains the actual data.

Use the ContentVersion to create the new record. The Excel file data should be stored in the VersionData field. You will also want to set the Title and PathOnClient (including the file extension) fields.

The ContentDocumentLink can be used to create the link to a record that supports chatter feed tracking (including custom objects).

From Base Lightning Components Considerations:

When working with type="file", you must provide your own server-side logic for uploading files to Salesforce. [...] Uploading files using this component is subject to regular Apex controller limits, which is 1 MB. To accommodate file size increase due to base64 encoding, we recommend that you set the maximum file size to 750 KB. You must implement chunking for file size larger than 1 MB. Files uploaded via chunking are subject to a size limit of 4 MB.

The Base64 is pushing the file size past the Maximum HTTP POST form size—the size of all keys and values in the form limit of 1 MB. Or at least this seems like the applicable limit here.

Instead you will need to go with either an embed Visualforce page as used in How to Build a Lightning File Uploader Component. This gets you up to the Maximum file size for a file uploaded using a Visualforce page limit of 10 MB. Just remember to keep the file processing to a minimum before the heap size limit catches up with you.