I saw my endo today and I asked him about adding progesterone to my hormones because I thought it might help me to feel more like a natal female, with cycles and stuff. He told me that it wouldn't do anything and that it would add another level of complexity that is not needed. Is he right?

There is no evidence on progesterone doing added benefits

At the same time there is no evidence it does nothing also...

Personally I take it and I believe it has changed the way I think
Feel things..
Plus it is said anecdotally to help with some female sex characteristics
Such as softening of the skin and nipple development

I think the negatives far outweigh the possible positives. This conclusion is after discussing the topic with several SRS surgeons and experienced MTF endocrinologists.

If its bio identical progesterone then do the negative side effects still outweigh the positive? And what are these negative side effects?

Ive been on progesterone now for about 7 months (bio identical). I was started on the medroxy at first but then switched due to the depression side effect. Once I was on the Bio identical progesterone, the depression went away. I haven't had any negative effects since I made the switch.

I never got depressed on medroxy...

The pharmd I talk things over with never said a single bad.
Thing about it either.   

Hard to rule out unless you are in a tightly controlled environment