But the xbox S isn't meant to play HDR games natively , its only meant to up scale
HDR isn't something that's "upscaled".
If you TV is HDR then it'll display HDR ready games in HDR. Its that simple. If your TV isn't HDR ready then it'll not show HDR ready games even if you are using an S which is capable of HDR.
The S only outputs 4K when watching 4K DVDs. The S does not upscale games to 4K.