I won't be able to help without first know the exact update that broke it. Look here:
https://github.com/raspberrypi/firmware ... kernel.img
That's a list of all commits to kernel.img (which is probably the relevant file).
Click on the "browse code" button next to a given date's kernel. You can now click "view raw" and download that version of the kernel.
Hopefully just the kernel is sufficient to see if the problem still occurs.
You will need associated modules if you want to startx or use external peripherals, but normally the keyboard is handled in the main kernel.
