This is because there is a difference between the Home Activity Stream and a workspace activity stream. In the Home Activity Stream you can hide updates from certain workspaces: https://help.podio.com/entries/21685331-The-Home-Activity-Stream. Whereas in the workspace activity streams you can't hide updates but will click to remove the the item.
We have just updated the x-icon in the workspace a activity stream with a trashcan to make it more clear that you are removing something.
Thanks for your feedback on this.
//Sara - Podio