Good luck with your emulator. Wish I could try it on PC at least from the time being. Do you have a homepage or a site where to download it? From my experience with Windows Phone -which alas is going to be killed, it seems- the emulators use your SD card to look for the roms, but also you can use your onedrive account and upload then download -or just load- the roms from there and play them. Hopefully both methods should work on the X1 with uwp.
There's no PC version (aside from the Linux one running on my deskop that's not publicly available) and if there ever is it's not very likely it'd be freely available for download.
considering all the emulators at google play store I think no one have a good case against emulators, it should be the same with the xbox apps, hopefully.
They'd be legally able to do it, but unfortunately a lot of places ban emulators anyway. Like Apple's app store and Amazon's. MS allows them on Windows Store, but it's possible they'll feel differently about allowing them on a console.