A Firmware Update Broke My Controller, Can I Go Back To The Old Version?

You will not be told that updates never break things, because they sometimes do, and Microsoft themselves acknowledge it. They maintain a documented reversion process specifically for controllers that develop connection problems after an update, which would be a strange thing to publish if it never happened. So your instinct about the timing is reasonable.

What is worth separating is the two symptoms, because they probably have different causes. Connection behaviour is squarely in firmware's remit: the wireless stack, pairing, retry timing and power handling all live there, and a regression after an update is plausible. An intermittent bumper is a mechanical switch, and firmware does not change how a switch makes contact. It is much more likely that the bumper was beginning to fail already and you are noticing it now because you are paying close attention to the controller. Two years of use is squarely in bumper-wear territory.

So do the reversion for the connection problem, and treat the bumper as its own investigation. Roll back, run the stability test for ten minutes, and compare against how it behaves now. If the drops go, you have your answer and you can stay on the older firmware until a later release fixes the regression. Then test the bumper on its own with the button test: press it fifty times and count the misses. If it misses after a rollback too, it is the switch, and that is a separate and inexpensive repair.

One genuine caution. Staying on old firmware indefinitely is not free, because updates do also fix real connection bugs. Check for a newer release every couple of months and try it when one appears, rather than treating the rollback as permanent.