You've pretty much answered this yourself - a function, just like a component, is a self-contained unit. If you're working within the scope of a function, you don't switch back and forth; but I'm pretty sure you wouldn't want to have to declare the names of any local variables in that function in some kind of global variable table in another file ("let's add a loop here.. switch to vars.file, add someFunction_firstLoop_i as 0... back to the loop, add the variables...").
Then your second paragraph is a great point against the need for Tailwind and the long class attributes, as you’re going to encapsulate all of that in a component (and “switch back and forth” to see its styles) anyway.