I basically take a similar approach to you. I give animals a smaller -u0 penalty if they are less self-aware and less capable of forming the sort of complex eudaimonic preferences that human beings can. I also treat complex eudaimonic preferences as generating greater moral value when satisfied in order to avoid incentivizing creating animals over creating humans.
I took a crack at figuring it out here.
I basically take a similar approach to you. I give animals a smaller -u0 penalty if they are less self-aware and less capable of forming the sort of complex eudaimonic preferences that human beings can. I also treat complex eudaimonic preferences as generating greater moral value when satisfied in order to avoid incentivizing creating animals over creating humans.