BLE version 3.53 is clearly defective. The error went away when I downgraded back to BLE version 3.50.
Maybe the .dll file went missing due to some reason. But you can do the following:
Navigate to C:\Users\<user_name>\Documents\PSoC Creator\<psoc_creator_version>\Downloads ( 4.2).cylib
Here you will find a folder called "BLE_v3_53". Please delete it and then perform update components in your PSoC Creator project. The files will be generated again and this time your DLL should be generated successfully.