In defense of the 700XR, I agree out of box it is not ideal on soft surfaces and trails since it’s configured as a commuter. However, a few simple and cheap mods probably would have given you a much better off-road experience. I’ve been around mountain bikes for awhile and I think the 700XR started off as a generic mid rise hardtail mountain bike first, commuter bike second. Just looking at the geometry it can be configured to handle smoother trails, gravel and FSR’s quite well. The head tube angle of around 66 degrees is well suited for lIght off-road use and indicative that this started life as a mountain bike.
The biggest factor holding it back are the street oriented Super Moto X tires. While they are a top pick for general street use and groomed bike trails they offer little or no traction in other situations. I immediately swapped them out with Schwalbe Smart Sam 2.6” tires, removed excess weight such as fenders & rack and added a Thudbuster and it made a world of a difference. While the 700XR is by no means a hardcore single track shredder (don’t even think about doing jumps) it does quite well as a hybrid commuter and cross country style mountain bike. I liken the 700 as a luxury SUV with AWD versus a Jeep Wrangler with true 4wd. Given your situation in Arizona and the kind of riding you want to do, I don’t think any 27.5 or 29” mountain bike would have been ideal. BTW, nice choice going with Juiced