It’s not a difficult frame to find parts for, plenty of stuff will fit it.
142mm x12 hubs are an evolution of a standard 135mm hub & although relatively new plenty of options available
The Stereo is a good frame to build up into an AM bike
Your friends have very little patience or knowledge by the sound of it (not meaning to be harsh but that is how your post comes across to me)
As far as I know & DT Swiss website says you can get an X12 X1600 so the DT X1600 hubs should be convertible to X12.
You should just need a conversion kit, I don’t know if another brand of conversion kit will work on DT’s stuff
I would contact DT Swiss to confirm this though
Until last month I had a wheelset that would have worked, Sun Ringle hubs (OE stuff from a Cube Sting) sold em though when I upgraded to OE Cube DT CPW 1200 wheels (based on the XRC 1350 wheelset)