I hate to sell the Nikon because of the modern shutter but will there be much of a difference in picture quality between the Nikon and Xenar?
It depends... in some situations you'll get a very similar image, but there are important nuances.
The Nikon and the xenar are quite different lenses. One is not "artistically better" than the other.
Regarding optical performance we also have a variability between the lenses of the same model...
The Nikon is a superb Plasmat design (
https://en.wikipedia.org/wiki/Plasmat_lens), very well corrected even in the edges at relatively large apertures, (probably) low flare multicoated and a top performer. John Sexton moved to the Nikon W series and many of his prominent works have been shot with the W series, still (reportedly) he owned several units until he gathered top performer samples, but perhaps not many would see the difference between the samples he discarted and those he kept, probably only an artist of his kind may see some difference. Personally I use the W 210 and 360 with great satisfaction, but I can't tell if they are much better or worse than the Sironar N I have.
The Xenar is a superb Tessar design (
https://en.wikipedia.org/wiki/Tessar) it has less elements and less groups than a plasmat and it can't be as well corrected, at least at large apertures. With the Xenar corners won't be as sharp until we stop it a lot, by f/22 and beyond the Tessar has the spheric aberration better corrected and then diffraction happening in both the Xenar and the W is starting to limit both, so mostly you will find that as both are stopped difference will be lower.
Still... many times the peak performance won't be obtained because you have other limiting factors, like focus accuracy, DOF or vibrations. For example if you shot handheld then motion blur is to be totally dominant. Also check what are the image circle sizes and if that makes a difference for your camera movements.
This Xenar could be the original lens of this camera, so it can be a total sin selling it

. Also the Xenar is superb for portraits as it delivers a great bokeh and, depending on situation, less costrasty textures that are good for skin.