Because I think that Iroh isn't necessarily telling him that he has to let go of wanting to be the Fire Lord, but instead that he should go for it through another path, not by capturing the Avatar to please his father.?? Also, I think the scar is gonna go, because when Iroh is saying, "when you finish the metamorfosis, you will be the beautiful prince bla bla bla (can't remember exactly)" when he's saying beautiful, he's passing a towel over his scar.?? May be looking too into it, but I think it's a hint.
Edit: anyone noticed that Jet wasn't mentioned once... you know, after you think you loose someone, and he was fighting so valiantly, I think you should at least mention the name, especially when no one knows if he bit the dust for sure.