Pearson, the case of discarding precision in order to form accurate approximations does not strike me as self-deception, and your arguments so far haven't yet forced me to discard the category boundary between "discarding precision in accurate approximations based on resource bounds" and "deceiving yourself to form inaccurate representations based on other consequences".

I'm not saying they are the same thing exactly, they feel different from the inside if nothing else, I'm saying they can have the same set of consequences. Using an insufficiently precise approximation can still get you killed. For example if you do a proofs in a seed AI about the friendliness and affectiveness of the next generation using reals to represent probability values and then it implements it in reality using doubles, the proof might not hold. And you might end up with an UFAI.

So you should have similar safeguards against approximation as you do against lying to yourself. If it is very important avoid both as much as possible.

And in every day lives, lying to oneself about inconsequential things is not too big a deal. If it doesn't matter if you forget what you had to eat last Thursday, it doesn't matter if you lie to yourself about what you did have to eat last Thursday.