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Business Requirement is to create 400 components based on a single schema in Tridion and then publish all this content as xml or json file to the File system. Thats all whats needed from Tridion end.
What is the best approach to achieve it, keeping in view below two option:
case1: Get all the content for 400 components in one single output File.
case2: For each component get one individual file as output on file system
Depending on how often you expect content to change, I would be inclined to recommend using one file per component (your case 2).
I would also investigate using the CD WebService instead of file system to distribute this content, it might scale much better than "xml files on a file system".
And as for how to publish it, I would certainly recommend not re-inventing the wheel and reusing either the DD4T or the derived DXA CM templates, which publish JSON.
Well, firstly there isn't much information on what you want to do with the 400 components when you publish them. Please provide that information to get better responses.
Without knowing that, I would suggest using use the OOB Tridion functionality to push publishes to file system and use it however you want it. For doing that you need to configure cd_storage to deploy to file system and then publish your components.
