From what I've been able to observe after supporting home users for several years:

Routers go bad all the time.

In fact just this afternoon I replaced a malfunctioning router. It was sporadically disconnecting all its wireless users from the internet, while wired users would stay on. Power cycling the router fixed it for a time but the problem would return. Dying routers do this sort of thing.

Replace the router, and use something that's known to be reliable. I still use the WRT54GL router a lot of the time, because it's just more reliable than most of the modern routers I've tried. The problem is that it doesn't have any of the modern updates like 802.11n (let alone 802.11ac), or USB ports for sharing printers or hard drives. But you already have a router with similar functionality, so it wouldn't be a downgrade at all.