Hello,
I’ve tested in my environment that Excel files in Reports library will only be opened in web browser if users only have read permission, so that means it works fine as expected and I cannot reproduce your issue. Please take following actions to see if they can work:
1. Go to Reports Library > Settings > Advanced Settings to select “Display as a Web page” for “Opening browser-enabled documents”
2. Go to Central Administration > Operations > Services on Server to start Excel Calculation Service
3. Go to SSP > Excel Services Trusted File Locations to add your current report library’s address
If the problem still exist, please let me know.
Regards,
Jerry
Xing-Bing Yu