Build Advice Upgrade existing or build new for Diablo 4?

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a note: that 30-50% performance loss is *exclusive* to the 6500XT and no other cards, because it's a laptop GPU put in a desktop connection, and thus only uses 4 PCIe lanes. You don't see this with other GPUs at all, with losses between PCIE 4 and PCIe 3 of 2-5% at most.

I'd do a BIOS update on your current board and get a 5000-series CPU and drop it in there.
depending on budget, a 5600, a 5700, or a 5800X3D.
Either of the 65W CPUs will get by fine on a cheap tower cooler in the $20-30 range, the 5800X3D will need a good cooler in the $40-60 range.
get a 6600 to 6700XT GPU
and get a new PSU. Your existing one was fine when it was new, but it's aging pretty hard at this point
700-850W is fine. 550 is fine for the lower-end GPUs
And I'd add a second SSD at 2 TB, whether NVMe or SATA, as games are getting very big - 150GB is not unheard of nowadays.