I tend to agree with you, but there’s another saying: “play to your strengths”, because people don’t all have the same potentials. I think it’s healthy to always strive for self improvement, but going with the grain of one’s personality is easier and likely to land in a better place. That’s the message I take from “be yourself”, but I have to admit that it does ring a bit hollow when one is young and hungry.
Colloquially when people use the term "fake it till you make it" they don't really mean "pretend to be a different person". They just mean act in the face of uncertainty. You can do it with or without undeserved confidence, it's besides.