That update notice won't go away and cannot be skipped. If you click the update button and then select cancel, Kobo will close the app.
Apparently Kobo won't give me permission to read my ebooks unless I agree to their demand. Never mind that I bought a number of the ebooks in that collection - they all belong to Kobo. I'm merely using them on Kobo's sufferance.
See, this is exactly the reason why I remove DRM. I get to control the content I bought - not anyone else.