New iPhone stuck on Software Update - New eSim iPhone won't update - iPhone transfer failed.

Update2: If you are stuck you can just power down both phones and start over. The original phone will always stay the same just the SIM card to Esim on the new one will move.
Update1: If the new phone does not prompt for an update when moving to new device, yet the process still fails. Start up the phone as a new phone, and check for updates manually. It will likely have 1 update. Update that and try again.
Moving iPhone with SIM card to a new iPhone 14 with eSIM, the phone gets stuck in an update loop.
To avoid this, begin the phone transfer, move the SIM to eSIM. At the next step the phone will start to update (old phone will wait for new to update). Here is where the device gets stuck.
Simply restart the new device (cancel transfer on old) and set it up without transferring everything. Once the device is setup, update it to ios 16.
Once done, go to settings - transfer or reset iphone - reset and be sure to not remove the eSIM. Only delete apps / data.
Once the phone reboots, itl start up as new again (but with version 16). At this point start the new device transfer again and it should go through without issue.