Final answer:
To update existing Target Table records during data import from an import set, the 'Update' option should be used. It ensures that matching records found in the Target Table are updated with the data from the import set.
Step-by-step explanation:
When importing data from an import set and seeking to update existing Target Table records, the correct option to choose is Update. This operation checks for matching records in the target table based on a predefined unique key or a match on the sys_id column. If a match is found, the existing record is updated with the information from the import set, rather than creating a new record which would happen if the Insert option were used. The Merge option typically combines the insert and update operations based on the presence of a record in the target table: it updates records if they exist and inserts them if they do not. Lastly, the Append option adds new records without updating existing ones.