It's got pros and cons.
The scope is absolutely going to be limited to what the terrible OG X1 specs can handle. What we can expect from X1X and Scarlett is better resolution, textures, and framerate. All great things, but in terms of world/AI complexities, it's absolutely going to be hamstrung by the antiquated base hardware.
Pros :
+Available for more users
+Higher spec Xbox models will run it in a prettier fashion
Cons :
-Game will be less than it could have been with 9th gen baseline (provided the devs could find ways to leverage the extreme leap in CPU performance for more/better AI and complex world systems)
-Makes Scarlett less interesting overall. It's not likely that the Scarlett will offer much more over the X1X, and equal to PC, in terms of this title. And for gamers with an X1/X1S that might have been tempted to buy a Scarlett for this entry, well, one less reason to jump in early.
So it's a strategy that makes sense in some ways, but lets things down in other ways. If they cut it off and made it a 9th gen launch title, it could have been a solid sales pitch. We don't yet know the exclusive lineup for the PS5 and Scarlett launch period, but it definitely seems like something you would want to at least consider for that showdown.