Fascinating. This must've been very difficult. I liked your breakdown a lot.
A potential solution would be to not have the XP elements at all, and instead just have raw stat increases.
For example, lets say an orc breeds an elf, then the child just has a stat increase depending on the girl type. If you wanted to have a Gacha mechanic, you could have exponential growth instead of just the regular increase. That way you don't have to grind as much. The XP system just adds a ton of overhead.
you could also have it so that an orc can only breed a few times before they die/go sterile, so the player will always have a rotating set of Orcs.
Otherwise yea, looks great.