HI, do the OTA updates still work after unlocking bootloader, installing TWRP and rooting?
I've ordered one and was thinking about doing the about doing the above right out of the box.
No, you probably will end with an unbootable device or defective operating system (but it could work too, it's unpredictable without trying).
You will end flashing a fastboot image via MiFlash, so better not OTA updating and flashing directly a full ROM image when you're ready to update.
If you want to try the OTA update, backup your data before because it could become inaccessible after.
OK, will loose settings and App data when flashing the (updated) full stock image?
If I remember well, there should be an option to retain settings and apps data (it depends on what .bat file you choose to flash), but I advise against preserving this data, as it will probably cause many problems afterward.