Well, I run a 5800X3D + 3070 + 32GB. I have no experience upgrading from a non-X3D part. That said, I have zero performance issues in ESO.

For reference: I have almost all graphical settings cranked. Framerate is typically ~100Hz with DLSS Quality at 4K and VRR. Been in few large Cyro battles lately, maybe 1 recently in a full campaign and everyone at the same keep on the map. Even the 3rd faction had at least one ball group running around. I did not notice any performance change, but I couldn't tell 100Hz from 60Hz unless I looked, tbh. It's VRR and will fluctuate is all I'm saying. Always looks smooth to me.

I main a cloaking light armor NB, by the way. My playstyle is very sensitive to lag. I've historically played in IC, partly for this reason, but these days Cyro and IC feel much the same from a lag standpoint. Since ZOS' server upgrade and my PC upgrade from a really old one.

I run with disabled hyper-threading, because the CPU runs about 20W and 10C cooler that way, when stress-testing. I also limited the GPU to 70C and power limit to 70% for low noise. This incurs a 20% framerate loss in Furmark, but in ESO you hardly notice the difference. ESO doesn't stress the GPU as hard in the first place; the framerate stays almost the same.

In other words this machine is overkill other than the fact that 4K is nice to avoid stair-stepping effects and you can zoom in on screenshots. I would say yours is too. 16GB would be enough, btw. I played ESO on an 8GB machine in the past (now that was tight). I very much doubt you need the X3D (any flavor) for this game, at least not with the pop cap and the servers being as limited as they are.

I hang on to PCs for a really long time, e.g. 10 years+ if I can, with maybe just a GPU upgrade down the line. In that case getting the top CPU for your socket makes sense, perhaps. Otherwise I wouldn't do it. Also, in terms of single-player games, the GPU should be the limiting factor in our systems.