I still rely on --xcode working to create an Xcode project that can index, navigate, and edit, but not build, the compiler, since I use a separate ninja configuration for that. So I'd be fine with --xcode being relegated to creating an edit-only project. Erik's instructions for integrating Ninja builds with Xcode still rely on --xcode working to create the initial Xcode project, so his approach wouldn't be viable if we completely remove the --xcode option IIUC.
For a long time, a lot of the problems with the Xcode build have come from the way we set up the build system to cross-build components for the target architectures, such as the runtime, standard library, and other bundled Swift libraries. Longer-term it would be great if we could move those out of the compiler build system so they can be developed and built separately. However, in the short term, what if we make it so that --xcode only sets up build targets for the compiler itself, and maybe the runtime C++ code targeting the same host as the compiler? My primary concern using Xcode is getting good C++ navigation support; I haven't found another IDE that does as well with the LLVM or Swift codebases.