Yes, having a camera show “offline” while in fact it is working fine is a somewhat common issue. Sometimes you can clear it with the steps you have already taken, but none of those are reliable. Wait a while and it will clear up by itself. Might take hours, and might take weeks. I have 30 operational Wyze cameras, and almost always have at least one in the false “offline” state. Currently it is one of my older V2 cameras that is at a remote mountain top radio site so no practical way to power cycle it.
And as you noted, when in the false “offline” state, you can’t firmware update the camera.
If you want to update the firmware and see if that fixes your “off line” issue you can do this procedure. Download the December 6, 2021 firmware 4.36.8.15 to your computer then extract the firmware file to an SD card. Read step 2 of the directions to rename the file. I don’t know if this will fix your issue.