Will having both USB and 5V power active cause problems?

Hi,
Please don’t do so. As mentioned on its wiki page:

For power supply pins: The built-in DC-DC converter circuit able to change 5V voltage into 3.3V allows to power the device with a 5V supply via VIN-PIN and 5V-PIN.

XIAO RP2040 currently only supports battery power supply and cannot connect to Type-C while a battery is connected, as it may pose a safety risk.

Please use one kind of power supplying method at a time (USB-C, 5V pin, battery connected to VIN pin).