As you say opening the xlsx file in LO does produce the green splash
caused by multiple renderings of an embedded image.
I ran two alternative tests:
1. Opened the file in Excel 2013 and (as expected) it displayed
correctly. However, there was no visual evidence of the image. I then
extracted the contents of the file and removed the image.
When I reopened the modified file in Excel the file still displayed
correctly, which suggests that the image served no useful purpose, or
Excel somehow auto-adjusted to the image's removal.
When I reopened the modified file in LO the green splash was gone, but
LO interpreted the file structure by replacing what was the image with
multiple place holders. While the green splash is inconvenient and
annoying, my main concern would be that, with or without the embedded
image, LO did not render the drop-down list boxes in column B.
2. Opened a fresh copy of the file in Excel 2013 and saved it in ods
format. Opened the ods file (which still contained the embedded image)
in LO and the file displayed correctly, including the the drop-down list
boxes in column B.
I don't know what, if any, purpose the embedded image serves, but it
seems like it would be worthwhile filing a bug report.
If it would be of any assistance, I can send you repaired copies of the
file in both ods & xlsx format.
Dave