Q: I would love to hear your take on the phrase: 'the observer is the observed'
A: To me, this is the last stage of the non-dual exploration. At first, it is useful to talk about 'observer' and 'observed', because the fact that there is something (which is not a thing) that observes all experience is overlooked. In that way, that which is Aware becomes conscious of itself.
The second stage is to understand that all experiences - thinking, feeling, perceiving - appear within Awareness. Not only that, they are actually made of It. If there is nothing outside of Awareness, doesn't it mean that all that appears within is but Awareness vibrating within itself?
When this is understood, the observer and the observed become known as the same.