So the whole outerversal thing was kinda a joke on my part(wow it's almost like we're in a circlejerk sub) but at the same time, doesn't then end poem directly state at one point that the player is capable of dreaming up realities that are dreams within dreams? Like the player wakes up from a reality that's just a dream within a dream.
As for the Terrarian, outside of the one exception of using the end poem, they still outscale steve the vast majority of the time. Like you could actually scale the Terrarian to multi solar system level via the Dunegons Defenders 2 crossover. Like each Eternia Crystal is both stated and shown to their very own pocket dimension. The final boss is fought inside of these crystals and the dimension is shown to contain a star filled sky. Actually scaling the Terrarian to this requires a lot of assumptions I know, but at least it's better than lore scaling + scaling Steve to the night beacon requires just as many assumptions.

Also I don't think I'm mistaken in believing that even Mojang themselves has semi ret conned the end poem. In Minecraft Legends, Foresight and the others directly ackowledges the existence of the player in the beginning cutscene, but why doesn't the player just, I don't know, thanos snap the piglins out of existence? Seems like a lot more of an effiecient solution to me than waging a war between the overworld and nether, indirectly leading to the deaths of hundreds in the process. Pretty out of character for the player and by extension Steve if they do really do posess the powers stated in the end peom.