In admin/config/regional/language/list we have the language labels be presented using both the native and the non-native form of the language:

In places like the user account edit form however, we output only the native label:

...and in the "Add language" form (in admin/config/regional/language/add), the dropdown select uses the non-native version:

This is because the function language_list() accepts an optional boolean $native_names parameter, which outputs the labels either in the non-native/English version (default behaviour), or in their native version (if $native_names is passed as TRUE to the function).
I would like us to consistently be outputting both versions of the language labels everywhere, and I also believe that the default should be that (like in the language listing page). Since that would constitute a backwards compatibility breaking change though, I would like us to at least figure out a way to allow output of both native and non-native labels in the #options array (if the optional $option_list parameter is set to TRUE), and see if we can do that in the 1.x cycle, keeping backwards compatibility and the output of the function otherwise unchanged if possible.
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