Updating your system seems to have gone fine.
Your issue is most probably due to having two initramfs-generator installed at the same time.
You should have one or another. Not both.
For now I would suggest to remove dracut (you could always switch to dracut later if you want):
In chroot:
pacman -Rs dracut
Then regenerate your initramfs:
mkinitcpio -P
When done, regenerate your grub.cfg:
grub-mkconfig -o /boot/grub/grub.cfg
In case of any errors, post the whole of terminal output from the relevant step above.
If no errors, quit chroot by typing exit followed by enter and reboot.