Mkoll,
I see the "conventional speech" explanation as applicable to the third watch of the night, but not to the first two. In the case of the first two, it is not simply a matter of linguistic constraints. What is being described necessarily involves a notion of self.
First watch of the night
I directed it to the knowledge of recollecting my past lives. I recollected my manifold past lives, i.e., one birth, two... five, ten... fifty, a hundred, a thousand, a hundred thousand, many eons of cosmic contraction, many eons of cosmic expansion, many eons of cosmic contraction & expansion: 'There I had such a name, belonged to such a clan, had such an appearance. Such was my food, such my experience of pleasure & pain, such the end of my life. Passing away from that state, I re-arose there. There too I had such a name, belonged to such a clan, had such an appearance. Such was my food, such my experience of pleasure & pain, such the end of my life. Passing away from that state, I re-arose here.' Thus I remembered my manifold past lives in their modes & details.
Second watch of the night
I directed it to the knowledge of the passing away & reappearance of beings. I saw — by means of the divine eye, purified & surpassing the human — beings passing away & re-appearing, and I discerned how they are inferior & superior, beautiful & ugly, fortunate & unfortunate in accordance with their kamma: 'These beings — who were endowed with bad conduct of body, speech & mind, who reviled noble ones, held wrong views and undertook actions under the influence of wrong views — with the break-up of the body, after death, have re-appeared in the plane of deprivation, the bad destination, the lower realms, in hell. But these beings — who were endowed with good conduct of body, speech, & mind, who did not revile noble ones, who held right views and undertook actions under the influence of right views — with the break-up of the body, after death, have re-appeared in the good destinations, in the heavenly world.' Thus — by means of the divine eye, purified & surpassing the human — I saw beings passing away & re-appearing, and I discerned how they are inferior & superior, beautiful & ugly, fortunate & unfortunate in accordance with their kamma.
In both these cases the object of contemplation (past lives, reappearance in accordance with kamma) is framed in terms of a self or selves: my manifold past lives, their kamma.
The third watch is different. The first person pronoun (I) is used here, because from the standpoint of the Buddha's audience there is still an individual there speaking to them and relating his experiences. But the experiences being related are not based in a notion of self. The Buddha does not say "the cessation of my stress, my fermentation, my becoming," etc. There is a clear change in the syntax: the object of contemplation is no longer attached to a possessive adjective.
Third Watch of the Night
I directed it to the knowledge of the ending of the mental fermentations. I discerned, as it had come to be, that 'This is stress... This is the origination of stress... This is the cessation of stress... This is the way leading to the cessation of stress... These are fermentations... This is the origination of fermentations... This is the cessation of fermentations... This is the way leading to the cessation of fermentations.' My heart, thus knowing, thus seeing, was released from the fermentation of sensuality, released from the fermentation of becoming, released from the fermentation of ignorance. With release, there was the knowledge, 'Released.' I discerned that 'Birth is ended, the holy life fulfilled, the task done. There is nothing further for this world.'
nless one is so confident they will realize arahantship in this very life, or at the very least stream-entry, then seeking a favorable rebirth is a prudent thing to do. That way one has the opportunity to cultivate the wholesome in the next life. Where does the Buddha say that one, especially a householder, shouldn't seek a favorable rebirth? In fact, I recall a sutta where he says to "not be afraid of making merit" or something to that effect.
I don't think I've suggested anywhere that one shouldn't seek a favorable rebirth. Where are you seeing this? I just raised a question about the relevance of rebirth-belief to nibbana.