The taps on a xfmr like this are on the high side. That means you'll be hitting a 208 volt winding with 240. Depending on the actual voltage, it might saturate the core, maybe not. It'll run pretty hot, be noisier than usual, and the no-load current will be high. If the machine it runs only does an 8 hour shift, and you de-energized the xfmr when not in use, you'll likely be OK. The worst thing would be to have it sit there, humming, with no load on it.
The wye to delta thing isn't an issue at all. Don't connect XO to anything, just leave it float. Make sure XO isn't grounded.
Using buck-boost xfmrs on the incoming line will certainly work, and might be the best solution. Depending on the actual voltage, you'd likely use either 16 or 24 volt ones. Unless the incoming voltage is balanced VERY closely, it'd be wise to use 2 xfmrs, and hook them up open delta. If you use 3 xfmrs and hook them up closed delta, and the incoming voltage is unbalanced by more than a volt or 2, you'll likely have an open delta pretty soon, (lol), because one of the xfmrs will burn up. The reason being that a closed delta system, by its very nature, will balance voltage at the expense of current. The 240 side of a buck-boost xfmr can't handle much current, and the one with the lowest voltage across it will try to bring the other ones down to its level. The one with the most voltage across it will try to raise the others up to its level. A small xfmr doesn't have much effect on a big power system, so it's overloaded even with no current at all on the secondary. An open delta doesn't try to balance anything, so no circulating current.
As far as voltage to the machine goes, a 480 volt machine will usually run just fine on anything from around 450 to around 500. Just my opinion, others may disagree.