Pikachu would probably be very curious. It might zap the lightsaber a bit to see what would happen, and then be in awe of the bright blade. It could also get a bit protective of Ash when he wields the lightsaber, as if it senses the added danger.
At first, Ash would be in shock. But then, he would likely turn his focus on finding out the truth. He's not one to give up easily. He'd start investigating what led to his betrayal. He might even go on a journey within the RWBY world to find evidence to clear his name and expose those who really are at fault. He'd still hold out hope that his former friends would see the truth and come back to his side.
His Pokémon might try to cheer him up. Pikachu, for instance, could use its cute antics to make Ash smile. It might nuzzle against him or do some of its signature electric tricks in a playful way. They have a very close bond, so the Pokémon would sense his sadness and do their best to make him feel better.
Pikachu would be very worried. It would stay by Ash's side constantly, using its electric shocks to keep him warm if he has a fever. His other Pokémon like Bulbasaur might use its vines to bring water or herbs to help soothe Ash's symptoms. Charmander could use its fire to keep the area around Ash cozy.
His best friend Pikachu might be a bit confused at first but would quickly adapt as it still senses Ash's essence. Brock would probably be very surprised and might offer some comical comments or advice on how to handle the new situation. Misty could be a mix of shocked and intrigued. She might be a bit jealous of Ash's new female appearance at first, but then would support him as they are friends.
Maybe a new, mysterious villain who has a grudge against Ash or wants to use his skills for their own evil purposes. This villain might be from a far - off region and has special powers that allow them to hypnotize people. They see Ash as a useful tool to carry out their plans in the Pokémon world.
His rival, Gary, could be a likely candidate. Gary has always been competitive with Ash, and in this fanfiction, his jealousy could reach a boiling point, causing him to betray Ash for his own gain, like trying to steal his Pokémon or get credit for his achievements.
Ash could become more confident and wise as a Dragon Master. His decision - making skills would improve as he deals with powerful and often unpredictable dragon Pokémon.
The Pokémon might initially think it's some sort of joke or mistake. But as time goes on, if Ash seems serious about being with Team Rocket, they could become divided. Some of the more headstrong Pokémon might leave Ash, while others might stay with him out of loyalty but still be unhappy about the situation. They would be constantly trying to nudge Ash back to his old ways of being a good Pokémon trainer.