you can use excel, however you should be importing comma or tab delimited files, as easy populate will not recognise the excel file format. the two lines that were returned in the temp file are probably just the first attempt (and subsequent failure) to read this file.

you can save your excel file when it is ready for importing by using the file->save as... function, and choosing the file type "*.csv". you'll lose your formatting, but that is of little consequence except when it comes to dates and numbers so be careful how you format those columns (can sometimes take a little playing around to get it right depending on how much info you're uploading).