Just an idea.
This worked for me even on a rather heavily modded 5.0.1, which I actually didn't expect to update without problems:
- put the 5.0.3 update .bin on the device via USB
- eject USB
- enable usbnetwork and log in via SSH.
- run showlog -f
- On the device, choose Menu > Settings, Menu > Update your Kindle.
This allowed me to follow the update progress both on the Kindle itself, as well as the messages it left in the logs.
No guarantees, but as said it worked for me, so you may want to give it a shot.