Psg is in the process of acquiring a new player from various clubs, including Dembele from Barcelona. If Dembele joins the team, I think the team's performance will be excellent, but due to another rumour I've heard, Barcelona wants to trade Dembele and Rafhina for mbappe, and the Paris Saint-Germain wants to purchase only Dembele because mbappe wanted to play for Real Madrid. To prevent another issue from the team, I believe PSG needs to resolve everything before the start of the Champions League. This is because the current problem with the Mbappe to another team has turned into another one for the team.
You just stated that Mbappe prefers to join Real Madrid over Barcelona, therefore the swap deal they're proposing won't work. PSG, in my opinion, needs money now, not a swap deal that may or may not be profitable in the future, such as what they will get by selling Mbappe now. When Al-Hilal presented the bid for Mbappe to PSG, they promptly welcomed the deal, but Mbappe refused to allow the deal to go through since he is not interested in playing in the Saudi professional league. Dembele's arrival to the team will benefit the squad even when Mbappe departs this summer.
Xavi must apply his domestic league teachings to the Champions League. In La Liga, Busquets and De Jong functioned well as a center, suggesting they may do the same in the Champions League. The summer transfer window brought in new players to strengthen the club and possibly aid Barcelona in the Champions League. With all these factors in mind, it's hard to determine when Barcelona will challenge for the crown. That appears to be in doubt.
If they've gone this far to strengthen the squad this summer, I have no doubt that they'll be able to compete for the Champions League title this season. They performed excellently in La Liga last season, and if they can bring that performance into the Champions League next season, I feel they will go far and might be a title contender for the next season's champions league. Xavi is an excellent coach, and he will do even better in the coming season.