I know it only applies to D2 data. I don't really care about the old account that is currently linked to my xbox. I was thinking, isn't there a way to delete my old Bungie account and then Link my Xbox to my newer account? Or does that not unlink the account? Otherwise all my hours of work are just gone. I can't believe there would not be another way to access it, without having to buy a Playstation.

No they still remain linked even after they've anonymized the account. To add to that bit, with a GDPR/CCPA erasure request, as part of the process, they will also permanent ban the platform accounts linked to the account; so your Xbox account would get a permanent D2 ban that cannot be appealed.