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"I don't know how to combine these together. It seems like I can't have a Table tool and Output tool used together, i.e. I can't see any highlighted cells."
You are correct.
The best solution that I'd recommend is use Excel Conditional Formatting on a Template File. Alteryx will write to the specific Range with an Output Tool. This will achieve your desired result.
Now implementing this is a lengthy process as you'll need to create a template file that can be written to. And you'll find that you don't actually want to write to the same template file again and again and again, so you'll need to know how to make a copy of the template file first.
Couple of Question: Will this be deployed on Alteryx Server or just Alteryx Desktop?
What Version of Alteryx are you using?
I'll grab a link where I've already discuss how to implement a Template Excel File Solution.
While it may not be a complete deal breaker the permissions and modification required to implement this method on Alteryx Server can be a headache (See Issues at bottom of post)
I couldn't find my old post. So I'll outline the solution here.
Basically, you'll use a BAT file to copy 1 file path (YOUR TEMPLATE FILE) to another file Path (YOUR OUTPUT PATH).
The Run Command Tool will Create the BAT File using the code in the formula tool, and execute the BAT file.
After the Bat File runs, you will then be able to write to you output path using a specific range. (Note the Parallel Block Until Done Macro)
For your use case, you'll want to use conditional formatting as part of you template file.
Issue/Modification for Alteryx Server:
If this is to be implemented on Alteryx Server, You'll need permission to run BAT file on the Server. Your Server will need access to a Shared DRIVE (WHERE the template and output will be located) You'll also need to use UNC paths.