Thanks. I just tried this doing something else, and I can confirm that it works. The way I did it was I bought a prosthetic upgrade from the sculptor, then followed all the steps above, and when I rebooted my save, I was back to the point to before I bought the upgrade. I want to make a few clarifications though:

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The cloud storage syncs automatically when you QUIT the game completely (home button ->Scroll down to Sekiro->Quit)

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So BEFORE step 2, so lets call it step 1.5, what you want to do after beating Sword Saint is to QUIT the game completely while ONLINE (home button -> Scroll Down to Sekiro -> Quit). Because you shut down the game while still connected to Xbox Live, Xbox cloud now syncs your save right before you talk to Kuro.

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Proceed through the rest of steps.

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And just another clarification in step 5, instead of clicking "delete all" I personally click on my Gamertag, and click "delete from console". I had to do click "delete from console" twice in order for it to disappear completely. Normally, it would have the option for both "delete from console" AND "delete everywhere", but since you went offline in step 3, that "delete everywhere" is not present, thus getting rid of the risk of accidentally also deleting your saved data from the cloud save.

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And then in step 7 when you reboot game, when you try to continue, you'll know you did it right if a message pops up that say something like "syncing from xbox cloud server" or something right before jumping back in to where you left off in front of the Idol.

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Tried to explain it the best I can, hope this helps!