Perhaps the change to python 3.5 from 2.7 has left your system in a confused state?
So try ‘bench update’ a couple more times.
If that does not help try this:
frappe-bench > cd apps/frappe
frappe-bench/apps/frappe > find . -name "*.pyc" -exec rm -f {} \;
Basically, all the .pyc needs to be rebuild because of changes in lots of core files.
As per here Switch branches in V11 [ cannot import name Database issue] - #15 by Zlash65
If that does not help then report the problem Issues · frappe/erpnext · GitHub