This sounds like exactly the kind of failure mode I'm trying to describe. In your "empty identity" scenario, I'd now guess that an image of "selflessness" or "blankness" or something like that would either bias your beliefs about yourself or slow your processing of them. In particular, it might interfere with certain cognitive capacities that other people find natural, obvious, and useful. This is speculation on my part, but to the extent that narrative features are a bottleneck in how our brains process beliefs about ourselves and others, the way you naturally and efficiently represent yourself to yourself may be physically tied up with with the same brain-bits that represent stories.

My thought here is that it may be better to learn to use that machinery sanely than to not use it... it's like getting a ridiculously fast software package for analyzing data that makes all sorts of known-to-be-false assumptions about how the data was generated collected. Using it entirely naively is probably bad, as is not using it at all. Knowing that when the package says "X" it's actually evidence for "Y", and using it accordingly, is probably best.