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Hi Emile,
That’s really weird. Maybe connecting the display is not the problem at all, but the display itself is interfering with the wifi signal. The WiFi chip of the Pi 3 is located directly on the board and is therefore vulnerable to signal attenuation by cases or displays. Maybe that’s why the 5Ghz connection works, because it has a higher frequency and can get past the display. You could still try to use a WiFi dongle (but then switch off integrated WiFi in the Raspberry settings). Maybe this will improve the connection. However, we cannot rule out that the installer of the Waveshare Display installs something strange, which may interfere with the WiFi connection too. But I suspect it is due to the size and proximity of the display to the Pi.