Enable IOS predictive text & suggestions on keyboard when Xbox is connected to the app.

You can connect your phone to the Xbox over a local WiFi network using the official Xbox app for iOS/Android, and use your phone's keyboard to type messages, URLs, and other text when using the Xbox.

Otherwise, I am not exactly sure what you're asking.

I open the xbox app on my iphone or ipad, hit the button to the left of the notifications, it shows my console is on and which one it is connected to, I select "open remote control," hit the keyboard function on the bottom left, type anything in (I literally typed "Test" in the box,) hit the return button and it minimizes but text box still appears and the text box on my xbox is not populated with what I type, and when I hit the 'X' to close the the keyboard and text box, the app freezes

Predictive text is only suggesting words...it's not auto populating the text box. You don't have you to use it but you cannot turn it off.

Or they could just use a keyboard. The One supports keyboards for text input, I can't imagine that it would be difficult to enable it for games too.

At least for standard Xbox controllers, there's no way to adjust sensitivity on the joysticks.

If you're having trouble selecting letters on the onscreen keyboard for typing out messages, you can use the D-pad on the controller, which I personally find easier for menu/keyboard input.

Alternatively, you can download the free Xbox app to your smartphone (iOS/Android)
and connect it to your Xbox One through Wifi. When the onscreen keyboard appears on your Xbox, the app will let you use the smartphone keyboard as input.