Most commentaries will interpret these verses correctly, as it is so obvious what Paul means. Much of the Bible is written in what can be styled as “different levels.” In terms of ceremonies, there is a physical and a spiritual level. The ceremonies have not been done away, but they have been raised—elevated—from their physical application to a spiritual application.
Many names and words carry a literal meaning as well as a symbolic meaning, implying that God intends a spiritual application too. Jesus used many parables in this dual way quite effectively. In addition, many prophecies have both a literal, former fulfillment and a final, latter fulfillment. It is easy to see that there is a physical level and a spiritual level to this subject of “the Israel of God” (see Galatians 6:16).
God’s promises to Abraham have both a “race” (national) and a “grace” (spiritual) aspect to their fulfillments. Thus, Abraham’s physical descendants—Israel—are greatly blessed with material wealth, but all of mankind is spiritually blessed through Abraham’s one great Descendant, Jesus Christ, and so the grace aspect is gradually being fulfilled as each judgment unfolds.
Here in Romans 2:28-29, Paul is using “Jew” in its spiritual sense. In this sense, “Jew” includes any converted person—even a Gentile. It indicates the church as the body of Jesus Christ (Ephesians 1:22-23; Colossians 1:18), when we recognize what is written in Hebrews 7:14: “It is evident that our Lord was of the tribe of Judah.” He—Jesus Christ—was a Jew by birth. Therefore, since He was a Jew, and we are part of “the body of Christ” in the Bible’s imagery—therefore we are spiritual Jews. And because we are spiritual Jews, we are spiritual Israelites.
It does not matter what race or ethicity we are. If we are converted, we are a Jew in the eyes of God because we are part of Christ’s body. That is the spiritual application. If we are a Jew, we are an Israelite too, and because the promises were given to Israel, the descendants of Abraham, the promises then apply to us.