Hi
The "DISTRO" should be fsl-imx-xwayland not fsl-xwayland. You can change it from the "local.conf" that you posted
I'd recommend you build from scratch with the correct DISTRO, the distro name will be fsl-imx-xwayland
DISTRO=<distro name> MACHINE=<machine name> source imx-setup-release.sh -b <build dir>
Regarding "create emmc bootloader with bitbake"
With successful completion of yocto build, you will see all files under the directory: <your build directory>/tmp/deploy/images/
You can refer to github.com for how to burn bootloader to eMMC to start.
Best regards
Harvey