I have a cross-reference to a cell and formatting of the xref text does not match my expectations of how it should appear. The font should be Georgia in the cells and the size should be 9 pt. I was able to replace the font as I explained earlier but the size does not change when I apply the xref. Why does the xref text change?
Here's my example.

Your x-ref format is to blame. The <Blue> character tag has more attributes set than you want. If you want the "Blue" character tag to apply just a blue coloujr and do nothing else, then you need to examine what is being applied.
1. Make a selection outside of the text frame, i.e. just click somewhere where there is no text.
2. Bring up the Character designer and scroll to the Blue character tag.
3. Is it showing any other attributes besides Blue?
4. If so, do Shift+F8 to reset all features to "AsIs" and then select just the colour.
5. Do an Update All to make this a global change to the character tag.
Now whenever the <Blue> character tag is used, it should apply just a blue colour and leave the rest of the text as the same as the surrounding paratext.
Note: what is the "purpose" of the <Blue> paratag? You would be better off using semantic naming (i.e. functional naming, rather than attribute-based naming) in the long term when it comes to document maintenance.