Lia Thomas was ranked 462. not particularly competitive.
You're right, Thomas is only "half decent" rather than "very good".
There's a sort of point there in that a "very good" athlete - someone really at top level in the sport - is unlikely to want to endanger that with transition. Why complicate things? So I think we won't ever see someone like Phelps or Federer transitioning, or even a top-level national athlete.
And it's true that it's not as simple as someone transitioning "simply to win at sports".
But there is clearly a pattern emerging of a "second career". When a man finds they are not quite where they want to be, or their performance is fading with age, then they have a potential path open to them. If they were in any way minded to transition, then it's a case of "what do I have to lose?"
If they do transition they not only get whatever they're looking for from the transition itself, they can have a second sports career into their 40s against 20-something women, or just boost their initial career to where they wish it had been. Win-win.
In Thomas's case he simply wasn't at the top of his sport - I believe he was at the performance level of "able to compete, but not making it into his college's long-distance relay team". Maybe it was a hard, unrewarding grind. But now he can win any event he likes, easily. It's fun again.
And this whole option is only open to men of course. Women don't get a second sports career. It's hard enough to do the first one, even without the men in the event.