I think you're overthinking it. The first thing you're told when you learn algebra is that a letter represents a number and you can say "let a equal (number), b equal (number)..." so you can let pi equal whatever you want for the purposes of one simple problem.
Well, if we want to be pedantic, they never said that h is the height and r is the radius of the base circle. They could be just random numbers.
Also, since we never calculate with all the digits of pi, it is not any less weird to round to the nearest 5 and say that it's 5, than to the nearest 0.01 and saying it's 3.14. It just has a higher amount of rounding error.
Except pi isn't a variable. It is a known value that we refer to as pi for convenience, and pi is a fundamental aspect of how a circle is. Saying "let pi equal 5" is all fine and well but is physically impossible, you will not be determining the volume of a cylinder if you let pi equal 5, because the ratio of a circle does not equal 5, it equals 3.14
But I suppose part of solving a maths problem is staying within the confines of the question and listening to instructions, so if someone says "using pi equals 5", I'd just use pi equals five and take my point with grace.
I think it’s actually a very interesting question. Pi does not equal 5 in our universe, but perhaps we can think of a meaningful universe where it does? Perhaps some mathematicians/physicists can chime in?