I downloaded it years ago from electrum.org (aware of possible phishing), and updated it every time I needed to. I reinstalled it now.
Best practice is to verify the installer every time you download it, even for updates. Using the official site is obviously a good idea, but it is not foolproof since web hosting can be hacked and redirect you to malicious sites, websites themselves can be hacked and have their download links replace with malicious ones, malicious software can replace the real software on download servers, and so on.
Unfortunately I stored my seed in .txt file, because I was fucking dumb, and that's probably my issue.
I agree that this is the most likely culprit.
I have no idea if my wallet is duplicated. I don't have it on any other device.
Yeah, that's what I meant. If you duplicate the same wallet across multiple devices, then you increase the attack surface.
Do you think it might have something to do with changing the "Expires by" from 1 hour to 1 week.
No, absolutely not. This is simply an internal feature of Electrum to let you keep track of incoming payments. It has no impact on the security of your coins.
Got any other suggestions on what to use that allows sending to sedwig addresses and is also nice and easy and fast and streamlined?
Maybe someone else can answer this for you. I only trade peer-to-peer on decentralized exchanges, so my suggestions are probably not what you are looking for.