To close this post, it turned out that the Xiao Sense that I was working with was defective. It is not entirely clear in what way. The original flashed code was running in a loop and giving errors. When I attempted to recompile the code with my local AP ssid and password, upload would always fail. I guess that the board was not switching modes correctly.
I finally bought some more boards, and at least the first one I have tried accepted an upload and now runs the example code as expected.
So, Like some other users, I must conclude that QC on these boards is not entirely up to snuff yet.
But I have one that seems to work.