I’ve had the exact same problem when upgrading from 8.5.2 to 8.5.3 : IOT devices on Ethernet VLAN lose DNS when the Balance One reboots into 8.5.3. This is discussed here: VLAN Not Getting External IP Access
It required me to turn off DNS caching then back on again to get them to start working.
So whatever bug it is, it still exists in 8.5.3.