Has there been any mention if Z Fighting will still be an issue on tsw 5? And has there been any mention of XSX getting the proper draw distance enhancement?
Nope. Don't hold your breath on the Z-fighting ever getting fixed, as DTG said they would have to go back and manually adjust every layer on every train to fix it. Too much work to fix a platform-specific bug, so probably never going to happen. Matt answered the question on a recent live stream, but I'm not searching 20+ hours of YouTube videos to find it, so don't ask.
I told him to wait... though I was expecting a fix-in-place direct upgrade to the TSW4 app this time.
One thing I noticed today. The Z fighting doesn't seem to happen when the train is stationary. Only once it begins to move. I also reinstalled tsw 2020, to test some of the trains from that version of the game. Sure enough, the HST and 377 and completely free of any Z-fighting. Maybe something happened when they moved to the newer unreal engine version, around the time of the rush hour releases. I seem to recall this is when it all started.