JOIN on Microsoft Access derived table not working
Perhaps rewrite the statement so Microsoft Access can more easily understand the requirements.

Something like:

SELECT
  T1.Product, 
  T1.Color, 
  T1.SEQMAX,
  Table1.Attribute
FROM (
    SELECT Table2.Product   
        , Table2.Color
        , SEQMAX
    FROM Table2
        LEFT JOIN
        (
            SELECT
              Table1.Product, 
              MAX (Table1.Seq) as SEQMAX
            FROM Table1
            GROUP BY Table1.Product
        ) AS MAXTABLE ON  Table2.Product = MAXTABLE.Product
    ) AS T1
    LEFT JOIN Table1
      ON T1.SEQMAX = Table1.Seq 
        AND T1.Product = Table1.Product;