Writing it as it sounds presumes that everyone who reads it will be working to the same set of pronunciation habits, but there is no guarantee that that is so. I pronounce certain words differently to some of my local friends, for instance, because I'm originally from Coventry and thus use a short -a- in words like bath and path. That's a Midland British thing. The marquis is a Londoner, and says barth and parth. And that's within the southern third of a small island, and two native speakers of the same language. If you're Welsh or Welsh speaking, Machynlleth is pronounced as it's written: different languages assign different sounds to letters. It would be very arrogant of me -- and very entitled -- to declare that my set of pronunciations was the default and 'write things as they sound' in that framework. As far as my own work is concerned, the reader has the right to pronounce the names as she or he chooses. I don't feel that my personal way is the only right one. It's not that I want to confuse people, it's that I don't feel that I own the language.
For the mystery novel I'm writing, I will be including a pronunciation guide, as the names in it are Welsh, and Welsh rules are not something every reader will necessarily know. I won't use the Anglicised spellings, though, because they carry with them a whole history of colonialism and English imperialism and attempt to eradicate Welsh as a language. Even accidentally continuing that would be deeply offensive. Also, I'm about 75% Welsh and I'm a historian of the Celtic speaking countries, so I have a personal attachment to be respectful.