display shows five bars. WIFI and internet both get a check mark, but system shows not connected and cannot update software error 003. Display shows network name, signal strength excellent, wireless channel 5, it has an IP address and Mac address
If you can, try connecting to your phone's hotspot just to get through the initial setup.
"Channel 5" indicates the Roku is attempting to connect on the 2.4 GHz wifi band. (The 5 GHz band channel numbers start at 36).
One possible cause of the symptoms you describe is that your wifi router may have received an update that reset its 2.4 GHz connection parameters from b/g/n to just g/n. Some routers supplied by Comcast/xFinity, Cox, and AT&T have received such an update, but there may be others.
Affected users report the Roku identifies the local network as available and rates the connection quality, but will not then connect.
The fix is to switch the router configuration protocols from the g/n wifi set by the update back to b/g/n. If you don't have access to your router's configuration controls you may have to have your internet provider do it for you.
Thanks to forum user @AvsGunnar for providing the links below to instructions for reconfiguring router settings from the listed internet suppliers: