This isn't something we have experienced during testing on Xbox, but it is plausible that it may just be a performance-coping measure that is handled internally by the simulator on Xbox.
Just speculation here as I don't have any knowledge of how the simulator works behind the scenes, but it may be that the simulator wants to keep a constant frame rate at all times, and to do that it is adjusting the scenery quality based on the current simulator's demands. So if you are flying a complex aircraft in scenery-intensive areas, it will have to reduce something to keep a constant frame rate, so it's choosing to reduce the scenery quality rather than the aircraft texture quality.
I sadly suspect this is an issue that is out of our control but we will continue to monitor this issue and investigate internally for any possible improvements we can make in future updates.
Mark - Just Flight