That doesn't look like an OTA update, otherwise you would presumably have received version 5.3.6.
It looks like "simply" one of the "normal" malfunctions. Such strange things happen on Kindles all the time, just look around the forums here
That said, I don't have a clue as to how you can make it behave normally again. Sadly, the only option that seems to work most of the time is a factory reset. A less extreme solution is to try and remove some of the recently added books. Kindles like to hiccup on some sideloaded books, causing all kinds of weird behavior.