Y'all remember this little gem? It came out in 2014 for PS4...but it also came out for the then-last gen systems of PS3 and 360.
The PS4 version was the lead platform, despite the game also having a last-gen version available, and prioritized the Nemesis system. This highly advanced AI system was impossible to implement on 360 and PS3....so it was simply outright removed altogether for those versions.
Here's a game, from a company much smaller than Microsoft, working with a game on two generations of hardware saying "'Ya know what? Why should we gimp the PS4 version for the 360 and PS3? We'll just remove that entire Nemesis game mechanic from the old versions instead. No need to hold back the next-gen version for the old consoles!"
So tell me, if a company the size of Monolith Productions was able to prioritize the then-leading next-gen system for game mechanics built solely for that system even when they KNEW the same version of the game on older systems would not be able to run those new game mechanics...why do some people think Microsoft will somehow NOT take this exact same approach if a game requires it? They have already mentioned that Halo Infinite (arguably their biggest upcoming 1st-party release) is using the Series X as the lead platform; you can bet that if the Series X version has game features the Series S is unable to run, they would much sooner just remove them from Series S version rather than punishing the Series X version from using them whatsoever.
Not to mention, with Microsoft's own capital and resources, this is something they could do much easier than Monolith Productions was able to do six years prior, and that's assuming the Series X and Series S versions are being developed by the same studios. If we look at MS's own prior track record with games like Forza Horizon 2, there's a strong chance different teams will handle versions between the two platforms.
Look, I still have my own reservations regarding Lockhart/Series S, but they left this realm of "it'll hold next-gen back!" a LONG time ago. There is literally no legitimate ground anymore for someone to hedge concern around Series S on that idea anymore, when we can look at games like SOM alone as well as the logical reality of how MS will prioritize software development (or already have). At this point, it comes off almost as concern-trolling.
If you want to talk about Lockhart/Series S in terms of it complicating production allocation between it and Series X, or possibly influencing pricing between the two models in an undesired way, those are fair game. Those are still areas of concern with Series S TBQH (and PS5 to a lesser extent with its dual SKUs). But this whole argument that Series X won't be exploited to its full potential due to the presence of Series S, is more or less a dead argument at this point. Too much evidence points to the contrary.