Using skin grafts and prosthetics they can already create the structures they want, so this would merely make a slightly more realistic looking structure, but probably not make it 'functional'. There's a number of active processes that would have to be reproduced, and I doubt there's sufficient existing wiring/processes in place to create the same effects. If you just don't have the wiring, it's difficult to make it work organically. But I can completely believe it will be possible in the future to create synthetic pumps to induce erection, and redirecting female ejaculation through the phallus should be simple enough.

Indeed. The current state of the art in vaginoplasty is nearly indistinguishable from the real thing; I think elasticity could be improved, but transwomen who can afford it are pretty well-served already. (Although affording it is kind of a huge deal; if this tech could be made significantly cheaper than standard vaginoplasty, it would be an enormous benefit to a lot of women.)

Phalloplasty, on the other hand, is somewhat disappointing right now--mainly because we can't yet create erectile tissue, so they have to resort to thing like pumps to get an erection. If we could create fully-functional penises, a lot of FTMs would be very happy.

I don't feel like finding the source, but iirc one of the articles covering this mentioned that they actually managed to grow a penis before they did vaginas, so that is indeed very good news for transmen. Whether it's been actually attached to someone successfully is a different question of course..

Why would a trans man want a laboratory grown vagina?