Michael Heiser’s book The Unseen Realm covers this in depth. I don’t agree with everything he says, but I found the book extremely interesting. He reveals in detail how in the ANE, they didn’t have the dichotomy between “spirit” and “material” that we do—at least not in the same way. For a divine being to be physically present on Earth (or even having sexual relations with human women, in Genesis 6) was not a strange thought. For them, heaven and earth were spatially connected; they didn’t think of them as different “dimensions” like we do. Beings could ascend and descend between the realms, in fact, that’s a major theme of Genesis (Nephilim, Babel, Jacob wrestling angel, Abraham having lunch with angels, Jacob’s Ladder, etc. etc.)
I wonder sometimes if we have the wrong ideas about what “incarnate” means. When God/Jesus appeared in OT in these theophanies, did God “take on bodies” temporarily or just become embodied in a different way?
What’s “it”? Genesis 1-11? If so, you’re using “literally” in an unusual sense if you put Keller in that group. When I went to Keller’s church in NYC, I attended a Sunday school class on Genesis and was taught that Genesis 1-11 needs to be understood in its original context, that its language is heavily figurative and poetic, that it should not just be taken in a flatly literal sense, etc. It was actually a very formative moment for me in my movement towards the BioLogos position. To me, Keller is trying to read the Bible “literally” in the sense John Walton promotes, i.e. according to the intent of the original author in their original context. But as you know, that’s different than the popular usage of the word. (As noted in the OP, John Walton was one of the main scholars who worked on this CQ.)
I don’t see anything in this CQ that is wildly out of step with what Keller thinks about Genesis (not as familiar with Warfield’s views)—at least according to Keller’s essay at BioLogos and what he has said elsewhere. My understanding is that Keller is a progressive creationist, so he’s OK with some concepts of evolution (and some level of figurative reading) but he has a more traditional view on Adam and Eve (as compared to BioLogos), and he also prefers to read Genesis 1 as describing a set of special creation events.