I already have contacts in Xero. Will the BytePhase Xero sync create duplicates?

It is designed not to. If Xero does not accept a new contact, BytePhase searches Xero for a matching contact by email address and then by name, and links the BytePhase customer to that record rather than adding a second one. To bring existing BytePhase customers across, the bulk customer sync shows how many will go and roughly how long it takes, then runs in the background and notifies you by email and in-app.