The thing that is stopping me is how am I going to transfer all my add ons from my Microsoft account to steam? Will I have to start from scratch on tsw?
You can't transfer add ons from one store to another, however as you have the game on Xbox you can download the PC version through the MS store on PC
Would that mean if I downloaded mods for transport fever 2 on steam (another game I play but can't really how I want to on console) would they appear?
You'll have to experiment as some mods work (I know my BCC timetable mod works) and some don't. There isn't a lot of documentation on the Xbox side as opposed to Steam.
Adding onto this as i'm still querying on whether to get a PC. Is it worth it to gradually rebuy all content and start from scratch on steam and then have access to all mods, or is it better to just use microsoft version without mods but hopefully have better performance.
If your friends have a PC, just try downloading TSW from your Microsoft account. Find the folder where the game is installed, and there should be a DLC folder there, where routes and locomotives are downloaded. You can add mods to it and they will work. You will also need a folder with saves and screenshots. It's located in the "Documents" folder on drive C. Engine.ini is located there, and there's another folder where you can install mods (this is an even more correct way). If all this is present, all that's left to do is check whether it's possible to add launch flags (-DX12 -HTTPAPI) to the launch shortcut. If the game launches in DX12 mode and has access to the real weather app, 100% of mods are available to you. It will take you a few minutes if you don't download all the DLC, which is not necessary for a test run.