I had heard that people weren't certain of the origins of NOEL - and the explanation on Wikipedia seems a bit convoluted.
The thought occurred to me that it could be a simple abbreviation of the last four letters in IMMANUEL.
The WAW (a Hebrew letter) can express both "U" and "O". A little child or someone not entirely familiar with Hebrew or Biblical pronunciations might certainly shorten it this way.
Immanuel: Born is the King of Israel.