Updates do not clear data.
The Itch app allows you to do some really strange things with installs using privacy sandbox mode, which some people have done and found trouble when reinstalling. All data is normally stored at:
%AppData%\..\LocalLow\RalivDev\Archipelagates
If you have enabled Itch sandbox mode (a data privacy feature itch offers to do nonstandard installs) I am afraid I can not personally account for how and where itch stores your data.