Hi Manu. Yes I can play other games in 4K@120hz. I have a 4K 144hz monitor connected to my Xbox Series X using an HDMI 2.1 cable.
I feel that upgrading the game to the newest Unity engine and Xbox SDK is inevitable. You can also have two versions of the game in the Microsoft store, one for “Xbox One” and another for “Xbox Series X|S”. A lot of games do that. This way, you would keep the current game and label it as “TE4 for Xbox one” and work on an updated version labeled “TE4 for Xbox Series X|S”.