Have you tried plugging your system into a TV that will accept HDMI by default and seeing if the problem persists then? We need to try and diagnose if it is related to the AV Converter or not.

The converter might not be able to parse the way kodi sends it HDMI data after an update, you could try editing /boot/config.txt and adding

hdmi_force_hotplug=1 hdmi_blanking=0 config_hdmi_boost=7

This will force the hdmi connection live and not drop the connection when the screen goes blank, as well as boost the signal on the line.

You can also try:

hdmi_group=2 hdmi_mode=56

Do not try all of these settings together initially, try the top set, then the bottom set and then both together. Report back if there is any difference when using any of the settings.