This study presents an error flow research method for simulation models of hydraulic systems in construction machinery based on the state-space approach, aiming to ensure the reliable application of digital twin models. Initially, a comprehensive analysis of errors in the simulation modeling of hydraulic systems in construction machinery was conducted, highlighting simulation model parameters as the primary error sources. Subsequently, a set of metrics for assessing the accuracy of simulation models was developed. Following this, an error flow analysis method for simulation models of hydraulic systems in construction machinery was explored based on the state space approach, delving into the sources, transmission, and accumulation of errors in the simulation modeling of valve-controlled cylinder systems. The research results unequivocally indicate that the spring stiffness, viscous damping coefficient, and hydraulic cylinder external leakage coefficient are critical parameters affecting the accuracy of valve-controlled cylinder system simulation models. Furthermore, it was observed that the simulation model of the control valve has a significantly greater impact on the errors in the valve-controlled cylinder system simulation model than the hydraulic cylinder model. In conclusion, the reliability of the error flow model was confirmed through simulation experiments, revealing a maximum relative error of only 3.73% between the error flow model and the results of the simulation experiments.