If you need to update a URL field in a links list (or any other list) from SharePoint Designer, you need to know this little trick. Create a string that contains the URL and description like this:
and then update the field with this string. Notice there is a comma AND A SPACE after the URL. There are no brackets, curly braces or octothorpes (# signs) involved in the string.
Using the string builder, you can see the "input" and the "output" of the workflow.